Marital Property Agreements in Frisco, McKinney, and Dallas, TX Areas
Texas is a “community property” state, which means that, in general, all assets acquired during a marriage are jointly owned by the spouses as community property. “Separate property” differs from community property in that it is owned entirely by one spouse. Generally, separate property consists of items owned prior to the marriage, assets that are received as gifts, or property that is inherited. There are also several other less common forms of separate property. This is why marital property agreements
The distinction between separate and community property becomes very important when 1) the parties divorce one another or 2) one spouse dies.
- Divorce – In divorce situations, the court can only divide the community property between the parties. The judge must award the separate property to the spouse who owns it, which means that a party must prove something is separate property to place it out of the judge’s reach in a divorce case.
- Death of a spouse – When a married person dies, 50 percent of the community property is owned by the surviving spouse, which means the will of the deceased person conveys only the 50 percent he or she owned. On the other hand, the will conveys 100 percent of the separate property owned by the deceased because the surviving spouse does not have any ownership in those items.
Property agreements are commonly made prior to a marriage but may be made during a marriage relationship. The primary purpose of a marital property agreements are to define what will be community and what will be separate property during the marriage. By drafting a property agreement, the parties can use the separate property and community property designations to structure the financial parameters of their marriage relationship.
Detailed information about the topic can be found on our “Marital Property Agreements” page.