One of the most stressful and contentious issues in many Texas divorces is how the couple’s assets are distributed at the conclusion of the divorce. While property division is likely to come up in almost every divorce, for those couples who own businesses, have significant real estate holdings, or own significant assets, disputes over property division are even more common. At the Law Office of Jason Wright, we represent clients facing complex property division issues. Attorney Jason Wright has extensive, hands-on experience effectively guiding his clients through the divorce process, ensuring that their interests are protected at every step of the way. Regardless of the issues your divorce raises, our Austin complex property division lawyer can help you make sense of the issues and help you to come up with a solution that works for you.
How Are Assets Distributed in a Texas Divorce?
Texas is a community property state. Thus, the presumption under the law is that all acquired by either spouse during the marriage belongs to both spouses. Regardless of which spouse purchased the property or which spouse’s name is listed as the property owner, if a couple obtained the property during the marriage, the presumption is that it is community property.
However, a spouse can attempt to designate some assets as their separate property. More specifically, anything that constitutes separate property will end up going to the spouse who owned it. Separate property includes:
• Any assets owned by a spouse before the marriage;
• Any assets that one spouse inherits in their own name;
• Any gifts received by only one spouse; and
• Damages awards recovered in a personal injury case.
However, all other assets are presumed to belong to both spouses and are subject to division by the court. As a result, determining whether an asset is community property or separate property can have a tremendous impact on the overall distribution of assets during a Texas divorce.
What Does a Texas Court Consider When Distributing Property?
As a community property state, Texas courts will divide all community property between the divorcing spouses. However, this isn’t to say that the court will split the assets down the middle. Courts are required by law to divide property according to what is “just and right.” Courts consider the following circumstances when dividing community assets:
• The needs of each spouse;
• The needs of the couple’s children;
• The age and health of each spouse;
• Each spouse’s level of education;
• Which spouse will be raising the couple’s children; and
• Each spouse’s ability to work and their expected income.
It is important to consult with an experienced Austin complex property division lawyer at the Law Offices of Jason Wright for assistance.
What Complicates the Property Division Process?
While many people going through a divorce expect some level of difficulty when determining how the couple’s assets should be distributed, certain situations present added complexity. For example, the following issues, when present, can make it much harder to identify all the assets in question and determine how to distribute them at the conclusion of the divorce:
If one or both spouses own and operate a business, a forensic accountant may be necessary to determine the value of the business. However, how an accountant values a business can have a major impact on the ultimate valuation. Thus, it is important to work with an experienced attorney handling complex property division divorces. That way, your attorney will understand the different valuation methods and advocate for the method that favors your position. If a couple jointly owns a business, it may be in both parties’ interest to sell it before the divorce is final. This too, however, requires that an accountant value the business.
Real Estate Holdings
Couples who own large real estate portfolios may agree on how to distribute the portfolio; however, often, these couples find themselves arguing over how to distribute their holdings. In general, there are a few ways to deal with these disputes. One option is for one spouse to buy the other spouse’s interest from them. While this is perhaps the easiest way of confronting the issue, not all spouses have the assets necessary to purchase their soon-to-be ex’s interest.
If an agreement cannot be reached and one spouse is unable to buy out the other spouse, the other option is to sell the property and divide the assets. Of course, while it is easier to divide liquid assets, this can still result in disagreement over the property way to divide the assets.
Other Potentially Complex Scenarios
While couples who own a business or own significant real estate holdings face some of the greatest challenges when dividing community property, other examples of potentially complex situations include:
• Dividing sizable retirement accounts;
• Dividing assets when one spouse is the primary income-earner;
• Dividing illiquid assets, such as business investment interests, bonds, or certain types of stock;
• Dividing foreign assets; and
• Dividing assets when the couple entered into a prenuptial or postnuptial agreement.
If your situation involves any of the previously mentioned issues, the chances are high that you will encounter some difficulty in coming up with a divorce settlement agreement that both you and your spouse can live with. By working with an experienced Austin divorce lawyer, you can ensure that your interests are protected as you work through these complex property division issues.
What Should I Do if I Believe My Spouse Is Hiding Assets?
In some situations, a spouse believing divorce to be on the horizon will transfer assets to avoid those assets from being discovered. Of course, this is not permitted. However, it can be challenging to identify and locate hidden assets during a divorce proceeding.
Often, this situation comes up when one spouse of the couple operates a business that deals with a lot of cash, such as bars, restaurants, vending businesses, or landscaping businesses. However, this may be a concern anytime one spouse operates a closely-held or family-owned business. If you believe that your spouse is hiding assets in anticipation of a divorce, reach out to the Law Office of Jason Wright for immediate assistance.
Is a Divorce Settlement Agreement the Answer?
Given the high stakes uncertainty involved in letting a court divide a couple’s assets, many couples first try to negotiate a divorce settlement agreement. A divorce settlement agreement is a “written agreement concerning the division of the property and the liabilities of the spouses and maintenance of either spouse.” Courts will honor a settlement agreement, provided the court finds it to be “just and right” and provided it comports with all statutory requirements. Thus, while there is some level of judicial oversight in the enforcement of divorce settlement agreements, courts will often accept them.
Of course, it is common for there to be difficulties when trying to devise a divorce settlement agreement that advances your interests and is acceptable to your spouse. Even if you have not had success talking through property division issues with your spouse, the assistance of an attorney can help. Once attorneys get involved in the process, the negotiation process becomes less stressful emotional, as the attorneys are the ones communicating regularly.
If you are involved in a complex or high net-worth divorce, reach out to Attorney Jason Wright. At the Law Office of Jason Wright, we help individuals effectively navigate even the most complex and challenging divorces. Attorney Wright believes in taking a practical approach to every divorce case he handles. He first listens to his client’s needs and only then proposes a course of action that will address all of their concerns. Attorney Wright will negotiate with your spouse and their attorney to arrive at a favorable divorce agreement whenever possible. However, as an experienced litigator, he is equally as comfortable in the courtroom when an agreement doesn’t appear to be in the cards. To learn more and to schedule, a free consultation with Attorney Wright, call 512-884-1221 today. You can also reach us through our online contact form, and Attorney Wright will be in touch shortly.
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