Marital Settlement Agreement in Texas

• Is a marital settlement required?
• Making property arrangements in divorce
• Items included in a marital separation agreement
• How a marital settlement agreement might help
• How to create a marital settlement agreement in Texas
• FAQ
• References

Is a marital settlement required?

To finalize your Texas divorce, you must fill out and sign a Final Decree of Divorce form. During your divorce hearing, you'll present this document to the court for review. If the judge approves your plans, you'll turn in a signed copy to the court, and this will lead to the end of your marriage.

A marital settlement agreement doesn't replace your final decree of divorce – it’s an additional document. A marital settlement agreement helps form the final decree, or the final terms of your divorce. The more detailed you are within your settlement, the easier it will be to create a final decree.

Making property arrangements in divorce

Texas Family Code, Chapter 3, divides property into two distinct categories that you’ll need to understand during your divorce: community property and separate property.

Community property includes items acquired by either spouse during the marriage. When you divorce, anything possessed by either party is presumed to be community property unless you can prove it’s not.

Separate property includes items brought into the marriage and items acquired via a gift or inheritance. The things you owned before you got married, and the physical or monetary gifts you got while married, are typically considered yours alone in divorce.

Some people have no disagreements about what is community property and what is separate property in divorce. Others claim ownership of items their partner believes they should not be claiming.

Proving that something is your separate property can be tricky. Gift tags or cards may help you identify items that are yours alone, as can a detailed inventory of what you brought into the marriage. Keeping inheritance or gift money in a separate account can be smart too, as it ensures that it isn’t mixed with shared money and harder to split.

Items included in a marital separation agreement

Since Texas is a community property state, assets and debts are split equally during a divorce unless the couple has a prior agreement. Your Texas property settlement agreement should be as detailed as possible.

Within the property section of your marital settlement agreement, you could outline plans for the following types of assets:

1.  Marital home: Will one of you live there, or will it be sold?
2.  Husband’s property: What assets will belong only to the husband in the divorce? You could include cars, boats, furniture, appliances, or other items in this section. You could also outline who owns a small business started during the marriage.
3. Wife’s property: What assets will the wife take away in the divorce? Again, anything from vehicles to electronics to small business ownership could be included here.
4. Payments: Here, we're talking about spousal maintenance, or alimony. If one person is leaving the marriage with more assets than the other, a payment could make things fair and equitable.
5. Retirement accounts: Will one person leave with the balance, or will it be split equally?

You can use a marital settlement agreement to address many issues, such as spousal maintenance (also known as alimony), health insurance, and a name change.

How a marital settlement agreement might help

Texas courts don't require divorcing couples to have a marital settlement agreement. However, couples who have this type of agreement could come to terms in discussions long before they enter a courtroom. This could simplify the entire divorce process for both parties.

How to create a marital settlement agreement in Texas

When you embark on the creation of a marital settlement agreement, you negotiate with your partner outside a courtroom. The steps are relatively easy, but they involve significant work.

1.  Define your property. Gather receipts, cards, bank statements, and other proof of private property ownership. With that information, make a list of everything you consider to be just yours and not subject to a split in your divorce.
2.  Consider retirement accounts. Determine how much you have in your retirement or pension account, and ask your spouse to do the same. If the amounts are relatively equal, you may decide to leave them with their original owners. If not, you’ll need to split them fairly or trade them for another asset (like a larger share in the family home).
3.  Discuss your children. Your children aren’t property, but you must outline how you will care for them after divorce. Items like child support payments, visitation schedules, and custody should all be part of your divorce negotiation.
4.  Determine alimony. If your divorce involves a large income discrepancy, you may need to consider payments for fairness.
5.  Write down your plans. Download a form like this and write out your formal agreements regarding the topics we’ve outlined.

You must also fill out a Final Decree of Divorce, which includes detailed sections about your property and debt. Your property settlement agreement can help you fill out this section quickly, as you’ve already dealt with these decisions.

During your divorce hearing, the court will look over your Final Decree of Divorce form. If you've made agreements that seem unjust or overly favorable to one party, the judge might ask for revisions that offer a more balanced resolution.

For example, let's say one spouse makes significantly more money than the other. They opt to keep the family home while making no alimony payments. The judge may consider that arrangement unfair and out of step with Texas law. In a situation like this, the court has the leeway to make alternate arrangements, even if the parties agreed to something different in their marital settlement agreement.

Suggested: What to Include in Your Settlement Agreement

Marital settlement agreement FAQ

What is the difference between marital property and non-marital property?

Marital property includes assets you acquired during the marriage. If you bought property, cars, or other items after your wedding day, they are typically considered marital property.

Non-marital (separate) property includes items you owned before your wedding day. Any cars, homes, or other assets you purchased before you married are your own if you can prove sole ownership. Gifts and inheritances you received during the marriage are separate property too, as are the items you might purchase with gift or inheritance money.

Note: If separate property is commingled during the marriage, it may not actually be separate anymore. 

Read: What Is the Commingling of Assets in a Marriage?

Are you required to have a marital settlement agreement in Texas?

No. Some people can’t agree before they arrive in a divorce courtroom. However, you are required to have a Final Decree of Divorce, which includes a long section involving property divisions. A marital settlement agreement could make filling out this detailed form much easier.

How long are parties bound by a marital settlement agreement?

Your property is permanently divided when your Final Decree of Divorce is filed with the courts after a judge’s review. Consider your divorce negotiations carefully, as the decisions you make here are hard to reverse.

What’s the difference between a contested and an uncontested divorce?

In an uncontested divorce, parties negotiate and make arrangements for their future. In a contested divorce, parties ask the court to decide some or all of their questions for them.

Are you covering everything in your Divorce Agreement?

See what most people include in their Agreements with our free download.

References