Asset & Property Division Attorney in Dallas, TX

When you decide to divorce, you and your spouse must figure out how to split up your property. Asset and property division is one of the most contentious aspects of divorce, especially when couples have substantial assets on the line. You need an experienced high-asset divorce attorney to help you navigate the division process and protect your rights to your separate property and your fair share of the assets you and your spouse share. 

Turn to Balekian Hayes, PLLC, for experienced legal representation. Founded by Kris Balekian Hayes, our attorneys have offered forward-thinking legal counsel and helpful support to clients going through divorce for over two decades. We’ll work hard to help you get the best start for this new chapter in your life. Contact us today for an initial case evaluation to discuss your options with our legal team.

What Are Examples of Assets in a Divorce?

In divorce, spouses must divide all property and assets in the marital estate. Common examples of assets that get split up in a divorce include:

• Real estate
• Vehicles, including motor vehicles, boats, and aircraft
• Jewelry
• Artwork
• Antiques and collectibles
• Checking and savings accounts
• Brokerage accounts
• Retirement accounts, including 401(k) accounts, IRAs, or pension accounts
• Business ownership interests

Is Texas a Community Property State?

Texas uses the community property model for asset and property division in divorce. Under the community property model, all assets acquired by either spouse during their marriage get treated as jointly owned, even if only one spouse holds title to the asset or spent funds to acquire it. Spouses must divide all jointly owned or “community” property when getting divorced. The community property system also treats all debts incurred during the marriage as community debt that spouses must divide in divorce. 

Community Property vs. Separate Property

During a divorce, spouses must identify which assets qualify as community or separate property. Separate property includes any asset owned by a spouse before the marriage or any asset acquired by one spouse during the marriage through an inheritance, exclusive gift, or personal injury claim. 

Spouses do not divide separate property in a divorce. Instead, each spouse retains sole ownership of their separate property. If one spouse claims that an asset qualifies as community property and the other spouse claims it as their separate property, the spouse claiming the asset as separate property must prove the asset’s separate nature by clear and convincing evidence. 

However, separate property may become community property through commingling of property. Commingling occurs when separate assets get mixed with community property, so it becomes impractical to identify which assets or portions of assets qualify as separate property. Spouses may also agree to convert a separate asset into community property. 

The court may also deem a portion of the value of a separate asset as community property. For example, if one spouse owned a home before getting married and the other spouse moved in following their marriage and contributed to mortgage payments, property taxes, and upkeep costs for the home, the other spouse may have a claim to the value of the property that accrued during the marriage. In this scenario, the owner spouse’s estate may reimburse the community or marital estate for community property contributed to the spouse’s separate property if the owner spouse intends to keep the home as separate property.

How Do Courts Divide Assets in Texas Divorces?

In Texas, courts must divide the community estate in a manner deemed “just and right” by the court, which means dividing community property fairly and equitably. However, this does not necessarily mean dividing the community estate 50/50. While courts may start with a presumption in favor of dividing community property equally, they might deviate from a 50/50 split based on factors such as:

• The spouses’ ages and health conditions
• The age difference between the spouses
• The spouses’ respective incomes or earning capacities
• The size of each spouse’s separate estate
• Each spouse’s financial condition
• The nature of the asset

Courts may divide community assets by balancing the total value of community property each spouse keeps. Alternatively, the court may order a couple to sell a community asset and split the net proceeds according to the court’s decree. 

A court may depart from the “just and right” standard in a fault-based divorce or if one spouse committed fraud upon the community. Grounds for a fault-based divorce include cruelty, adultery, abandonment, living apart for at least three years, confinement to a mental institution, or serving a felony sentence of at least one year. “Fraud upon the community” occurs when a spouse spends or transfers community property outside the marriage without the other spouse’s knowledge or approval to deprive the other spouse of using and enjoying the property. 

At the end of a divorce case, the court will issue a final decree of divorce that lists the separate property of each spouse, the community property that each spouse will keep, the community property the spouses must sell, the community debts each spouse must pay, and declares whether the spouses may keep or must divide community property retirement benefits. 

How Can an Asset & Property Division Attorney Help You?

In many cases, divorcing spouses will negotiate a settlement to divide their community property and debt. Whether you’ve chosen to negotiate a divorce settlement or want to have the court decide asset and property division, an asset and property division lawyer from Balekian Hayes, PLLC, can help you protect your interests and future by:

• Assisting you with gathering your financial records, including income statements, bank/brokerage/pension account information, vehicle titles, and property deeds
• Evaluating your family’s assets to identify which assets qualify as community property
• Advocating for your interests if you pursue a settlement with your spouse
• Persuasively arguing on your behalf to prove the separate nature of your separate property
• Fighting for a just and right division of community property in court or advocating for a more equitable division if your spouse bears fault for the divorce or committed fraud upon the community 

What Is Complex Property Division?

In Texas divorces, the division of assets often involves complex considerations, especially for higher-net-worth individuals. The distinction between separate and community property is at the core of such complexities. Separate property, which was owned before marriage or acquired through gifts or inheritance, remains with the individual, whereas community property, which was acquired during the marriage, is subject to division. This distinction can become blurred when assets are commingled, where separate property has been mixed with marital assets, making it challenging to determine rightful ownership.

Factors like business valuations, stock options, and professional practices add to the complexity. Additionally, Texas courts consider each spouse’s economic circumstances, including earning capacities and future needs, ensuring a fair distribution. Legal expertise and financial analysis are often necessary to address the nuanced issues and achieve an equitable resolution.

How to Prove Separate Property in Texas Divorces

In Texas, separate property in a divorce includes assets acquired before the marriage and those received as gifts or inheritance during the marriage. This category also encompasses any financial gains received from such properties, provided you can clearly identify them as originating from the separate asset.

During divorce proceedings, the burden of proving that an asset qualifies as separate property rests with the individual claiming it. This requirement necessitates clear and convincing evidence, a standard that demands a high degree of certainty from the court to establish the asset’s separate nature.

To meet this burden, parties in divorces involving significant assets must meticulously document and trace the origin and handling of their properties. Providing records that clearly show ownership of assets before the marriage is a straightforward way to establish their separate nature. These records might include deeds, registration documents, and financial statements. Legal documents such as wills, trust documents, or gift letters are vital for assets a spouse receives as gifts or inheritance. These documents should explicitly state that the asset is intended only for the individual, not the marital estate.

If separate funds have commingled with marital assets, detailed financial tracing will be necessary to prove their separate origin. This might involve forensic accounting to segregate and identify the flow of funds from separate accounts into communal holdings.

Keeping separate property physically distinct from marital assets can help establish its independent nature. This is often applicable to tangible items like vehicles, jewelry, artwork, antiques, watercraft, and aircraft.

Professional appraisals and expert testimonies can be crucial in some cases, particularly with complex assets like businesses or extensive investment portfolios. These professionals provide an authoritative assessment of an asset’s value and classification.

By employing these strategies, individuals can effectively demonstrate the separate nature of their property and ensure a fair division of assets during divorce proceedings.

Business Valuation in Texas Divorces

When one or both spouses involved in a divorce own business interests, valuation of those businesses becomes an important element of property division. The valuation process determines the economic value of a business, which is essential for ensuring an equitable distribution of assets.

Under Texas law, any business that one or both spouses established or developed during the marriage is typically treated as community property, even if only one spouse actively participates in its operation. In cases where a business was founded before the marriage but increased in value during the marriage, that increase in value is often subject to division. The valuation method may vary depending on the business’s nature, size, and complexity:

Asset-Based Approach – This method totals all the investments in the company, providing a value based on the sum of its assets minus liabilities. It is particularly relevant for companies with significant tangible assets.
Earning Value Approach – This technique predicts future income, discounting it to present value. It suits businesses with steady earnings projections.
Market Value Approach – This approach compares the business to similar companies that have recently sold, establishing a market-based benchmark value. It is effective for businesses in competitive industries with sufficient market data.

Commingled Property in Texas Divorces

In Texas, commingled property refers to assets mixed between separate and community property, which creates complexities in their classification and division during a divorce. This blending often occurs when one or both spouses combine separate property (owned before the marriage or received as a gift or inheritance) with marital assets or use marital funds to improve or maintain separate property.

Determining how to divide commingled property in a divorce requires a detailed analysis to trace the origins of the assets and decide the extent to which they have become part of the marital estate. For example, if one spouse owned a rental property before marriage but used marital funds for renovations, the increase in property value due to those improvements could be considered community property.

The challenge in Texas divorces lies in proving the proportions of separate versus community contributions, which requires meticulous financial documentation and sometimes expert testimony. Parties must provide clear and convincing evidence to delineate their claims, and may need to rely on the expertise of forensic accountants or financial analysts for support.

Working with an attorney skilled in complex property division can be beneficial in these scenarios. They help by ensuring proper documentation, hiring the right experts, and crafting a strategy to defend or challenge claims of commingled property.

Financial Asset Tracing in Texas Divorces

Financial asset tracing plays a pivotal role in Texas divorces, particularly when spouses need to distinguish between separate and community property. This forensic process involves identifying, categorizing, and evaluating assets one spouse claims fall outside the communal estate.

In Texas, typical assets requiring tracing include retirement accounts such as IRAs and 401(k)s, stock options, and deferred compensation.

For example, if a spouse entered the marriage with a significant 401(k) balance, any contributions and their associated growth during the marriage would constitute community property. However, the initial balance remains separate. Tracing these contributions requires meticulous examination of account statements over the duration of the marriage.

Stock options, especially those granted for work performed before the marriage but vesting during it, also pose a complex tracing challenge. Determining these assets’ separate and community portions depends on when the spouse earned the options and when they vested.

An attorney can assist with financial asset tracing by employing forensic accountants to track and document the origins and flow of assets, distinguishing between community and separate property. They ensure that all assets are accurately identified, valued, and categorized, which is crucial for equitable distribution in a divorce settlement.

Contact A Complex Property Division Lawyer Today

If you or your spouse have filed for divorce, get legal help to protect your rights and interests during complex asset and property division. Contact Balekian Hayes, PLLC, today for a confidential consultation to learn more about the asset and property division process in Texas from an experienced divorce lawyer at our firm.