When you and your spouse sat down to discuss your estate planning strategy, you likely went through a detailed breakdown of all your “stuff” and how best to protect it in the event of death or medical incapacitation. By stuff, we mean all your assets—the house, cars, retirement accounts, family heirlooms, bank accounts, business ventures … you name it. You expected this and took your time so that nothing was left out, and that your wishes for each item were clearly understood. You probably didn’t think about the difference between community and separate property and why you would want to make a distinction between them.

While it might feel like everything you own is shared equally, the law could see it differently depending on when and how that property was acquired. In Texas, assets owned by a married couple are classified as community property or separate property. That difference matters more than you think in terms of how your estate is created, managed, and protected. 

Understanding Community vs. Separate Property Is Important to Estate Planning

There is a lot that goes into this conversation on community property vs. separate property that we will dive into later. For now, we simply want to skim the surface and provide a baseline understanding of these two terms.

Community Property

Generally speaking, community property is typically any property and assets acquired during the marriage. For instance, you might have bought a house together after you were married or bought a new car. 

Here is the key: an asset does not have to be in both of your names or controlled evenly by both spouses to be considered community property. If it was acquired during the marriage—regardless of whose name is on the title—it is presumed to be community property under Texas law unless proven otherwise.

Separate Property

Assets that can also be considered separate property include, but are not limited to, the following:

• Property owned by one spouse prior to marriage
• Property acquired by one spouse using separate funds (such as money earned or inherited before the marriage)
• Assets received as a gift (such as an antique roadster your father left to you in his will)
• Inheritance through a will or a trust—regardless of whether ownership happened before or during the marriage

In short, the timing of when and how something is acquired determines whether it is considered separate or community property.

Why Does This Matter in Estate Planning?

Understanding what counts as community property and what falls under separate property is a key part of estate planning. It can affect everything from who gets what when one of you passes away to how taxes are handled. At the end of the day, you and your spouse can do whatever you want with your property if you are both on the same page. That said, you should also understand all the consequences before acting.

Our team of estate planning attorneys can help you navigate these questions confidently and prevent unnecessary complications. The right approach can secure your family’s future, protect your assets, and minimize potential risks. 

Call Leigh Hilton PLLC Today!!

Having a competent attorney in your corner will help you and your family navigate the often overwhelming waters of protecting everything you own and everyone you love. That is our job, and we think we do it better than anyone else. Call Leigh Hilton PLLC so that we can help ensure you and your family are taken care of in the best way possible. 

Leigh Hilton PLLC wants to be your first call every time for any estate planning need. We look forward to serving you.