Divorce in Texas is rarely an easy process to move through for spouses. When two people that have been married for a long time split up, there are a lot of legal considerations to consider. One of these is property division You may be wondering about things like heirlooms or even the college savings plan you set up for your children.
What are the legal classifications of property?
Texas is a community property state. Unless the lawyers of both spouses come to an asset division settlement, this will be the standard that is applied. This will result in different kinds of property receiving different designations that determine which spouse retains it. This includes:
- “Separate property” obtained before the marriage by each spouse and retained by that spouse
- “Community property” obtained by either spouse during the marriage and split up equally between both spouses
- “Co-mingled community property” that is not clear as to whether or not it is separate property or community property and is thus treated as community property by the court
- “Converted community property” that was converted from separate property to community property during the marriage by a signed decree by both spouses
What about assets like a college savings plan?
While that may explain what will happen to most kinds of property, there are still some assets that exist in a gray area that makes dividing them confusing. This would, for example, be the case for a college savings plan set up for a child.
Overall, the rules still apply. If it was set up during the marriage, it is community property and must be split appropriately. This will result in something known as a division plan. This will include decisions on dividing the account, when the child in question will be allowed to withdraw funds and how either parent can use the funds.
Although the standard of community property for divorce may seem straightforward, complications can arise due to the complexity of certain assets like a college savings plan. If spouses cannot agree on property division, alternatives, such as mediation or arbitration, can help keep the parties out of court.