Distribution of Marital Assets and Debts
Dividing assets and debts can be challenging, complex, and turn an otherwise civil divorce into a contentious battle. At Mark Rush Williamson, PC in Dallas, Texas, our attorneys have experience with dividing assets and debts, and can provide clients with knowledgeable advice.
Personalized Legal Services
At Mark Rush Williamson, PC, our lawyers provide a wide range of family law services that most other firms cannot provide. In the area of dividing marital property and debts, sometimes it is necessary to bring in forensic experts. We have long-term, working relationships with the best experts available to assist us with your case.
Asset Valuation Experience
Dividing up marital assets and debts goes beyond just taking an inventory of the items around your house and dividing them up. More complex assets such as businesses and pensions must also be distributed. We are experienced in the area of asset valuation and classification. We will conduct a detailed review of the value of a business owned by yourself, your spouse, or a partnership.
Dividing up marital property that involves pension plans may present significant challenges. Division can occur based on the current value of the pension, via a Qualified Domestic Relations Order (QDRO) that divides the benefit immediately so that both spouses will share the benefit when they reach an age of retirement. An interest in the plan can be given to a spouse without present tax implications or any penalty.
Texas Divorce Property Issues
How Does A Court Divide Property?
In a Texas divorce, the judge is to enter a "just and right division" of the parties' property. There is no set formula or calculation for this.
Property is classified in two basic groups: "separate property" and "community property." The court cannot divide separate property, and must award it to the person who proves the property is his or her separate property. However, the court can consider the amount of each of the parties' separate property when it divides the parties' community property.
What is Separate Property?
Separate property usually falls into one of these categories: 1. property owned prior to marriage; 2. property acquired at anytime by gift or inheritance; or 3. personal injuries awards.
If you owned something prior to the marriage, it is your separate property. If someone [including your spouse] gave you something as a gift, or if you inherited anything during the time of the marriage, it is your separate property.
What is Community Property?
Community property is relatively simple. It is all the rest. It is everything that is not "separate property." Regardless of whose name is on the title, deed, insurance policy, share of stock or bank account, it is presumed community property.
Community property is often defined as property obtained or acquired by either of the parties during the time of the marriage, except for gifts, inheritances, and things owned prior to marriage. This includes wages, salary, bonuses, and any other thing of value purchased or received during the marriage. Note: until the divorce decree is signed by a judge, its all community property.
How Is Property Valued?
Property is valued in a number of ways. The law allows an owner of property to give an opinion as to the value. This opinion, naturally, must be reasonable and based on something other than the ownership. Values may be made by the general marketplace such as the value of stock or automobiles, or things may simply have a value such as money.
How Are Debts Divided?
Debts are treated almost identically like assets. They are separated into separate and community property debts. If you owed the debt before the marriage, you get to pay it - it is not part of the community estate.
Note: unlike assets, debts involve third parties - the person or entity to whom the debt is owed. While the court has jurisdiction over the husband and wife, the division of debt in the decree does not affect or control these third parties
For more information, or to schedule an appointment regarding the division of marital property with an experienced lawyer, please contact us.