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Family Law

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Asset Protection Strategies

During any separation, whether initial separation or the process of divorce, questions will begin to arise regarding the property acquired during the marriage. The vast majority of property acquired in any marriage will be the property of both spouses. However, there are certain measures you can put into place to protect your property in case of divorce or other events.

Separate vs. Community Property

One spouse’s separate property includes the following:

  1. Property owned by the spouse prior to the marriage;
  2. Property acquired by the spouse during marriage by gift, devise, or descent; or
  3. The recovery for personal injuries sustained by the spouse during the marriage (although any recovery for loss of earning capacity will fall within community property)

Community property is essentially all other property acquired during the marriage, and a presumption of community property will exist unless proved to the contrary.

It is important to keep in mind that while the laws of Texas are clearly community property or separate property, other states have different marital property laws. Therefore, if the spouses were domiciled in a different state and acquired property during this time which would have been considered community property, a court may determine the best way to divide the property. However, property that was acquired in a different state while the spouses live in Texas will still be considered to be community property in most cases.

One common questions a party may have upon the dissolution of a marriage involves a claim for reimbursement for amounts paid toward the spouse’s student loan debt. The Texas Family Code specifically provides that a court may not recognize a marital estate’s claim for reimbursement for student loan payments. This debt became part of the marriage and therefore cannot be reimbursed upon the dissolution of the marriage to the spouse who helped pay the loan.

Asset Protection Strategies

The largest asset protection strategy is to sign and agree to a prenuptial agreement or postnuptial agreement. These agreements will clearly outline which property is to remain separate throughout the marriage, even if some property is jointly acquired. The consent of both parties to the classification of the property is enough for a court to determine it does not fall within the general definition of community property. This will help protect your assets and your family in case of divorce. However, it is important that you prove consent in the signing of a prenuptial or postnuptial agreement. One spouse may try to combat the terms of the agreement by stating that they did not voluntarily sign the agreement.

Malley Law Firm | Houston Family Law Attorneys

If you have any questions regarding the division of the marital estate or the protection of your assets during a divorce, do not hesitate to contact the attorney of the Malley Law Firm. Our attorneys have years of experience in handling clear asset protection strategies. Even though Texas is a community property state, there are methods you may take to protect your assets before and during a divorce. Contact our Houston or Beaumont offices today for your initial free consultation.


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