Wills

FAQs About Wills

The Characterization of Property in Texas

by Rania Combs

I have written before that the characterization of property as separate or community dictates who inherits property when a married person dies without a Will in Texas.  It also affects which property you can dispose of in a Will at your death.

But how does one distinguish between which property is community and separate? The following is an explanation of how Texas characterizes property.

Characterization of Property

Texas classifies property owned by a spouse as community property or separate property depending on when and how it was acquired.

Property that a spouse acquires before marriage is separate property. Texas presumes that property a spouse acquires while married is community property, except if the spouse received the property by gift or an inheritance.

For example, if you owned a house before your marriage, that home would be your separate property. Or, if you inherited a home from your parents, even during your marriage, that house would also be your separate property.

Property retains the classification as separate or community regardless of whether you convert it to cash or back again. So for example, if you sell a home that was your separate property, the proceeds from the sale will be separate property. That is true even though you sold the property while you were married. Additionally, if you reinvest the proceeds of the sale into another house titled in your name, that house would also be your separate property, even though you purchased it during your marriage.

However, if you want the property to remain separate property, it’s important that you don’t commingle it with community property. Otherwise it may be difficult to “trace” the property in a way that proves that it is separate property.

It is also important that you purchase property in a manner that will not raise a presumption you intended to make a gift to your spouse. For example, suppose you purchase a home during your marriage with your separate property. The house would be your separate property. However, if you include your spouse’s name on the deed, one could argue you intended to make a gift of half the property to your spouse.

Distinguishing Between Community Property and Separate Property

Texas classifies the following as community property:

  • Income either spouse earns during the marriage
  •  Property purchased with income earned during the marriage
  •  Dividends, interest, and capital gain earned on community property
  • Individual contributions to pension, 401K, or other retirement accounts from the date of marriage
  • Dividends and interest earned on either spouse’s separate property during the marriage
  • Unemployment compensation and payment for lost wages

Texas classifies the following as Separate property:

  • Income earned by either spouse before the marriage
  • Property owned by either spouse before the marriage
  • Capital gain on separate property, such as appreciated stock
  • Any property acquired by gift or inheritance
  • Retirement contributions made to a spouse’s retirement account before marriage
  • Personal injury damages for an physical injury settlement, even during the marriage (except for lost wages which are community property)

So for example, if you owned a condominium before your marriage, and rented the condominium out during your marriage, the rental income would be community property. However, if you sold the condominium during your marriage, the proceeds of the sale would be separate property.

Can Property Be Separate and Community at the Same Time?

It’s possible for property to be characterized as both separate and community. For example, suppose you purchase a home during your marriage for $200,000. Suppose further that the $50,000 down payment you made was your separate property. In that case, 25 percent of your home would be your separate property, while the remainder would be community property.

What happens if one spouse makes a down payment on a house before marriage, but the couple pays off the house during marriage? Is the property then a combination of separate property and community property?

No. Texas characterizes property as separate or community at the “inception of title.” If a down payment is made before marriage, the property is characterized as separate property. The fact that spouses use community funds to improve or payoff separate property may give rise to a claim of reimbursement; however, it does not change the classification of the property.

How does Texas classify property when each spouse contributes an equal share of a down payment before marriage? Since property is classified at the inception of title, each spouse will own a 1/2 interest as their own separate property.

Can Spouses Agree Which Property Is Separate or Community?

Prospective spouses can sign a prenuptial agreement to define what property will be separate or community property during their marriage.

Married couples can enter into postnuptial agreements that defines the character of their property. Marital couples can also agree to change the character of real or personal property from community to separate or vice-versa.

The distinction between separate and community property can get a bit confusing at times; however is very important in determining how property will be distributed at death. Each spouse only has the right to control who receives his or her separate property and their share of community property at death. Marital property agreements can reduce the potential for conflict by clearly establishing what property belongs to which spouse.

This article was originally posted on September 26, 2011 and updated on April 16, 2020.


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Comments

  1. KK

    May 13, 2012 at 8:50am

    If I purchase a home entirely with money from an inheritance, will it then become community property if my husband were to help pay for taxes, electric bills, etc?

    1. Rania Combs

      May 14, 2012 at 10:16am

      The character of the property should not change, but depending on the types of expenditures made, a spouse may be entitled to reimbursement for contributions that enhance the value of the separate estate.

    2. Michael

      July 10, 2019 at 3:28am

      What happens when a husband and wife are the shareholders in a family corporation and the husband who is the majority shareholder dies without a will. He has two children from a previous marriage and they have one child together. The business was started during the marriage to the second wife but she has basically been a silent partner..Does the surviving spouse automatically receive his shares or do the children have rights to them

      1. Rania Combs

        July 18, 2019 at 10:58am

        The following article discusses how property is distributed when a married person who has children from a prior marriage dies without a Will: Intestacy Can Be A Nightmare in Blended Families.

  2. Jamie

    June 27, 2012 at 4:41pm

    If I fund the downpayment and closing costs of a home prior to marriage, but once married (1 month later) the payments are made through a joint checking account, does that make the house separate or community property or a mixture of both?
    THANKS!

    1. Rania Combs

      June 28, 2012 at 10:11pm

      Whether property is characterized as separate or community is fixed at the “inception of title.” If acquired before marriage, the property would be separate. The fact that community funds are spent to improve or payoff separate property may give rise to a claim for reimbursement, but doesn’t change the classification of the property.

  3. Kandie

    April 15, 2014 at 11:48am

    If the home was purchased prior to being married, but then was refinanced during the marriage, would that make it community property at that time even though I am not on the paperwork for refinance?

    1. Rania Combs

      June 24, 2014 at 3:49pm

      Texas follows the “inception of title” rule. If the property was purchased before marriage, then it would be characterized as separate property.

  4. Gayle

    May 30, 2015 at 7:40pm

    I inherited some personal effects such as furniture and jewlery. Since I am married, do those items become community property since we will both be using them in our home?

    Thanks

    1. Rania Combs

      June 3, 2015 at 4:09pm

      Property acquired by gift, devise or descent (i.e. inherited property) is characterized as separate property.

  5. Clayton Chambers

    June 9, 2015 at 10:03am

    you stated that “Dividends, interest, and capital gain earned on community property” are community property. But what about Dividends, and interest on Separate property?

    For instance, if someone inherits a stock portfolio, are the dividends separate or community?

    Thanks!

    1. Rania Combs

      June 22, 2015 at 12:53pm

      Dividends, interests, rent, and other income derived from separate property of a spouse is classified as community property in Texas. Capital gain on separate property is characterized as separate property.

  6. S.J.Moore

    June 12, 2015 at 9:25pm

    I purchased a home during my marriage. The sales contract lists me as the buyer — sole and separate. The money for this purchase came from my separate bank account and from a large gift from my husband. Now, my husband has passed away and his kids are claiming 1/2 of my house as community property. My husband always kept our accounts and all business transactions separate. Do his kids have a legitimate claim? Thanks

    1. Rania Combs

      June 22, 2015 at 12:37pm

      Property acquired during a marriage is presumed to be community except of acquired by gift devise or descent. If funds used to purchase the real property were exclusively separate property (funds acquired before marriage and/or funds obtained by gift or inheritance), then the real property purchased with those funds should remain separate property. Please contact an attorney in your area to analyze the facts of your situation and make recommendations on how to proceed.

      1. Tanya

        September 10, 2015 at 5:23pm

        What if your husband built the house before we were married but paid it off with his 401k after we were married for 6 years? What happens then? HELP! I am so confused.

        1. Rania Combs

          September 18, 2015 at 5:32pm

          Texas subscribes to the inception of title rule, which bases the property’s character on the time and manner in which a person first acquires an interest in the property. If a home is purchased before marriage, then it would be characterized at separate property. However, a person may have a claim for reimbursement if separate or community funds are used to benefit the spouse’s separate property.

  7. RA Milliorn

    August 31, 2015 at 4:29pm

    Is the income from separate property or community property?

    1. Rania Combs

      September 18, 2015 at 5:39pm

      Yes. Income from separate property is community property unless it has been partitioned.

  8. D. Hunt

    September 9, 2015 at 8:54am

    My husband had 3 separate bank accounts prior to our marriage. During our marriage he has saved $10k. Will this be considered community property?

    1. Rania Combs

      September 18, 2015 at 5:34pm

      Income earned during marriage is community property unless spouses have agreed otherwise.

  9. The Characterization of Real Estate Purchased With Separate Property During Marriage

    November 13, 2015 at 2:07pm

    […] A reader asked a very interesting question recently after reading my article on the characterization of property in Texas. […]

  10. Angie G.

    February 19, 2016 at 11:36pm

    Can a property/home purchased during a marriage be sole and separate if the spouse relinquishes their rights in Texas? Is this possible?

    1. Rania Combs

      February 26, 2016 at 5:57pm

      Spouses in Texas can agree to partition their community property into two separate estates.

  11. Scott M

    May 3, 2016 at 11:28am

    Is the money received from being the beneficiary of a life insurance policy considered inheritance and would it be separate or community property?

    1. Rania Combs

      June 15, 2016 at 10:53pm

      Property that is inherited is characterized as separate property.

  12. Fay Horton

    May 31, 2016 at 1:27pm

    My husband and I had property given to us by my mother. He has died. Is the property mine solely or do my kids have claim to part of it?

    1. Rania Combs

      June 15, 2016 at 10:30pm

      Please accept my condolences for your loss. The following article explains how property is distributed when a married person dies without a Will in Texas: The Complexities of Intestacy in Texas.

  13. JoAnne Dugart

    July 14, 2016 at 10:10pm

    Are RMDs (Required Minimum Distributions) from a non-spouse inherited IRA community property?

    1. Rania Combs

      July 17, 2016 at 10:33am

      The following article may answer your question: IRS Publication 555.

  14. Gaurav

    November 9, 2016 at 12:49am

    1. Is it possible to convert a community property to separate property by some legal proceeding?

    2. Is it required to give power of attorney / affidavit / agreement paper by wife, when husband want to sell the community property which he purchased with his name only?

    1. Rania Combs

      November 30, 2016 at 4:02pm

      Yes. It is possible to enter into an agreement to convert community property to separate property. Selling community property would require both spouses’ consent.

  15. Karen

    January 27, 2017 at 2:42am

    My husband received property in a trust left by his dad. If my husband was to die without a will, would this property automatically go to me his wife? We do have a daughter together.

    1. Rania Combs

      February 17, 2017 at 1:50pm

      Trust provisions will dictate how property is distributed after the beneficiary dies. Often, the language of the trust will provide that any remaining trust property will be distributed to the beneficiary’s descendants after the beneficiary dies, although it may name another beneficiary. Additionally, the trust provisions may give the beneficiary a power to appoint trust property to another beneficiary.

  16. George Kim

    March 21, 2017 at 8:28pm

    Will my salary and capital gain from sale of my stock bought with my salary while separated (physically separated but legally married) be considered community property?

    1. Rania Combs

      March 23, 2017 at 3:58pm

      Capital gain on separate property, such as appreciated stock, is generally characterized as separate property, while income earned during marriage is generally characterized as community property. Please consult with a family law attorney regarding your individual case.

  17. Loretta yeverino

    March 22, 2017 at 11:32am

    My question is, my mother had property before marriage, then married, and shortly after passed away with no will. Who does the properrty belong to the new husband or the children in the state of Texas?

    1. Rania Combs

      March 23, 2017 at 3:54pm

      The following article may answer your questions: The Texas Intestacy Statutes.

  18. Austin Tate

    June 2, 2017 at 8:19pm

    My wife and I both bought our home before we were married. We are both on the mortgage and the deed of the house. We were married less than 6 months after closing on the house together. Separate or community property?

    1. Rania Combs

      June 16, 2017 at 6:30pm

      Texas subscribes to the inception of title rule. Character is assigned at the time a person first acquires an interest in property. If that happened before marriage, the property would be separate property of each spouse.

  19. Shannon Stirling

    July 17, 2017 at 1:18am

    My mother recently passed away with no will. She purchased a house 4 years ago with her boyfriend. They were not married. What does Texas law state about co-owning property without marriage? Who does the house belong to (her children or the boyfriend)?
    Thanks!

    1. Rania Combs

      July 17, 2017 at 1:35pm

      Please accept my condolences for your loss. Generally co-owners of a property will each own a 1/2 interest in the property. Unless there is a right of survivorship created, the deceased person’s 1/2 interest would pass according to the deceased person’s Will or through the intestacy statutes.

  20. Annette Martinez

    January 27, 2018 at 10:33pm

    I inherited a small house from my dad. I’m planning on getting married. I’m just wondering if the property will become his when we get married and when I die will it go to my children or him?

    1. Rania Combs

      January 31, 2018 at 5:15pm

      Property acquired before a marriage and during the marriage by gift, devise or descent is characterized as separate property. When a married person dies without a Will leaving children from another marriage, the surviving spouse is entitled to only a life estate in one-third of that property. The remainder is inherited outright by the deceased spouse’s children in equal shares.

      That being said, certain constitutional protections are available for surviving spouses in Texas. A surviving spouse is entitled to a life estate in homestead property and cannot be forced to sell her property as long as she occupies and uses it.

  21. Tina

    February 14, 2018 at 10:00pm

    If my husband put a down payment on the house before marriage but paid off the house once married is it community or separate property?

    1. Rania Combs

      February 23, 2018 at 7:04pm

      Whether property is characterized as separate or community is fixed at the “inception of title.” If acquired before marriage, the property would be separate. The fact that community funds are spent to improve or payoff separate property may give rise to a claim for reimbursement, but doesn’t change the classification of the property.

  22. DJ

    March 12, 2018 at 6:05pm

    My mother passed away and had no will. When she bought her home in 2006 she was not married. She married a year before she passed in 2012. Does the home go to her spouse or to me and my siblings?

    1. Rania Combs

      March 23, 2018 at 9:26am

      Property owned before marriage is characterized as property. According to the intestacy statutes, a surviving spouse is entitled to a life estate (the right to use the property until his or her death) in one-third of separate real property. The rest is inherited outright by the children of the deceased spouse. However, certain constitutional protections are available for surviving spouses in Texas if the property is the homestead. A surviving spouse is entitled to a life estate in the homestead and cannot be forced to sell the property as long as he or she occupies and uses it.

      1. Rosemary Cavazos

        September 12, 2019 at 12:43am

        So, the “Life Estate” is 1/3 of the Separate Real Property during life of surviving spouse and 2/3 to descendants children but if the spouse does not wish to live in the home and lives else where, prefers to sell.
        Does she get 1/3 of the sale proceeds or does the children get all?

        1. Rania Combs

          October 14, 2019 at 11:26am

          A life estate has value depending on the life expectancy of the life tenant. As such the life tenant is not entitled to 1/3 of the total value of the property, but rather the value of their interest in the life estate.

  23. Carlos

    May 23, 2018 at 4:03am

    If your spouse bought a house before marriage and wants to sell it after marriage does the other spouse have to sign off on it to be sold since it is separate property?

    1. Rania Combs

      May 29, 2018 at 12:36pm

      Even when the property is classified as separate property, if the property is the couple’s homestead, spousal consent will likely be required for the sale.

  24. Christina

    August 19, 2018 at 2:04pm

    So i recieved an inhertance when my father passed. I have been married for 9 years and plan on buying a house. The house will be paid fully with my inheritance and nothing else. The realtor has both mine and my husbands names on the contract. Would the house be community property being that the house is being paid in full with my inhertance? If we were to get divorced would he be able to fight me for the house even though he didnt pay anything on it? And what would i need to have him sign so that he cant.He said he will sign something saying the house is mine alone.

    1. Rania Combs

      August 20, 2018 at 11:38am

      Thanks for your question. I recommend that you engage the services of a family lawyer assist you with a marital property agreement. If you do not, and purchase the home, with your husband’s name added to the deed, one could argue that you intended to make a gift of half the property to him. A marital property agreement would allow you and your spouse to clarify your respective property rights and clearly define what will happen with the property if you divorce.

  25. Mar

    August 26, 2018 at 12:37am

    Is my 401K considered community property?

    1. Rania Combs

      August 28, 2018 at 9:48am

      If a 401(k) accrued during the course of a marriage, it will be characterized as community property.

  26. Michele

    October 7, 2018 at 11:42am

    If I sell my real separate property, are the proceeds separate or community? Also, If I use those proceeds are used to purchase real property in Louisiana, would it be separate or community property? If any of this becomes community through the transactions, is there any legal documentation such as a “post nup” that could be executed to keep the property separate? Thanks!

    1. Rania Combs

      October 8, 2018 at 11:44am

      Property retains the classification as separate or community regardless of whether it is converted to cash or back again. So for example, if one sells a home that was separate property, the proceeds from that home will be separate even though the property was sold when the owner was married. A post-nuptial agreement provides added peace of mind.

  27. Shelly

    November 26, 2018 at 2:33pm

    What if the house was purchased before marriage (financed), at the time of marriage the house was in bad shape and during our marriage we have made lots of upgrades and increasing significantly the value of the property while also making payments on the mortgage together. If my spouse dies, would the house still be considered as separate property and I would be entitled to only 1/3 of the house and his children to the 2/3?

    1. Rania Combs

      November 28, 2018 at 7:01pm

      Whether property is characterized as separate or community is fixed at the “inception of title.” If acquired before marriage, the property would be separate. The fact that community funds are spent to improve or payoff separate property may give rise to a claim for reimbursement, but doesn’t change the classification of the property.

  28. Ken mcmahon

    January 28, 2019 at 5:20pm

    My brother passed away and he was never married and never had kids. He left behind 5 siblings. He had some money in the bank and a vehicle. When filing a small estate affidavit would that be considered a share of separate personal property or a share of separate real property

    1. Rania Combs

      January 28, 2019 at 5:43pm

      Real property would refer to land and any property attached to it, such as a house or building.

  29. Patricia Lewis

    February 26, 2019 at 3:37pm

    I reside in Texas, my husband recently passed and left his life insurance 100% to his mother. We have 5 children and nothing. Is there anything I can do about this legally since we were still together and still living together when he passed?

    1. Rania Combs

      April 24, 2019 at 5:37pm

      I’m so sorry. Under Texas law, a surviving spouse may have a claim for constructive fraud when an insurance policy was purchased the with community funds for the benefit of a person outside the community. I recommend that you consult with a lawyer in your community about the best course of action.

  30. Norris

    April 2, 2019 at 11:27pm

    I purchased my home a month before I got married. According to online literature its considered separate property. I’ve made all the payments for both mortgage and utilities only since the duration of the marriage. Is there any way my spouse can claim any equity etc through divorce?

    1. Rania Combs

      April 24, 2019 at 5:02pm

      If a home is purchased before marriage, then it would be characterized at separate property. However, a person may have a claim for reimbursement if separate or community funds are used to benefit the spouse’s separate property.

  31. Aaron

    June 23, 2019 at 5:16pm

    My wife closed on a home 12 days before we got married. During the marriage I paid half the mortgage for 4 years and the full mortgage for 3 years. Is it still separate property regardless of how much I paid into it?

    1. Rania Combs

      July 18, 2019 at 11:10am

      Whether property is characterized as separate or community is fixed at the “inception of title.” If acquired before marriage, the property would be separate. The fact that community funds are spent to improve or payoff separate property may give rise to a claim for reimbursement, but doesn’t change the characterization of the property.

    2. Terrica Hyder

      September 29, 2019 at 8:21am

      Hi. I have a question I do believe I understand the difference in community property and separate property. My husband was given land property before our marriage. We both have decided to build a home on the land my income is the majority due to his disability. In the event that something happened to me, would our home then fall under community property and would my children I had before marriage be entitled to anything? If something happened to my husband, what then would I be entitled to if we build the house on the land he inherited?

      1. Rania Combs

        October 14, 2019 at 10:41am

        Whether property is characterized as separate or community is fixed at the “inception of title.” If acquired before marriage, the property would be separate. The fact that community funds are spent to improve or payoff separate property may give rise to a claim for reimbursement, but doesn’t change the characterization of the property.

        The following article discusses how property is distributed when someone dies without a Will in Texas: Dying Without a Will: The Texas Intestacy Statutes. Of course, it is possible to identify a surviving spouse as the sole beneficiary under a Will.

  32. Jillian R Shelby

    July 30, 2019 at 3:49pm

    My father passed away in 2011 and my stepmother was in a hurry to get the will probated and left me and my sister out of the process all together. I found out why a couple of months ago. What she turned in was not my dads will, and she took over everything by fraud. She cut us out of it and said she was the only heir basically.

    The probate papers list his houses and land as separate property because he inherited it from my grandfather and was supposed to have been our after she passed. Well she is selling part of it and said her lawyer wouldn’t help her if my name was in the will. What can i do to make sure our inheritance is preserved.

    1. Rania Combs

      October 14, 2019 at 11:42am

      Please consult with a lawyer in your community to advise you on the best course of action to protect your interests.

  33. Tom

    December 8, 2019 at 6:55pm

    I owned a house before I got married. I’m continuing to make payments on the mortgage after my marriage, and my spouse is also contributing to those payments. The mortgage is only in my name. What do I/we need to do to make sure the house is passed to her with the least amount of complications or expense if I die?

    1. Rania Combs

      December 9, 2019 at 1:18pm

      If you wish to name an individual as a beneficiary of separate property, you can make a specific bequest of that property in your Will. It is also possible to create a Texas Transfer on Death Deed to transfer property to the beneficiary outside of probate.

  34. Joseph Campana

    December 17, 2019 at 8:42pm

    Good evening- I have a question related to the difference between community property and separate property. I purchased a home prior to becoming married. I then relocated (active duty military) and my then girlfriend began occupying my property under a lease agreement we signed. 5 months later, we married. She continued to pay the same amount designated in the original lease for the next 5 months, eventually moving out and entering into a lease agreement elsewhere. We never cohabited the property and she is not on the title. Would my home be considered separate property under these circumstances?

    1. Rania Combs

      February 1, 2020 at 8:50pm

      Whether property is characterized as separate or community is fixed at the “inception of title.” If acquired before marriage, the property would be characterized as separate property.

  35. Jing

    June 9, 2020 at 5:26pm

    My husband and I are going to refinance our homestead now in TEXAS. Can we ask the title company to change the title to “community property with right of survivorship 100% to the surviving spouse”? that means, the surviving spouse will get 100% ownership of this property in the future.
    When we purchased our primary residence 10 years age, our title was recorded as “”husband and wife” on deed of trust.

    1. Rania Combs

      June 9, 2020 at 5:41pm

      Yes. It is possible to hold title with rights of survivorship.

  36. Emma

    August 27, 2020 at 12:36pm

    Hi Rania,

    My husband opened a stock account after our marriage in Texas. He transfered hs w2 to this account and bought stocks. Can he add me, his wife as the only beneficairy in this brokerage account, so that I could receive all the money from this account if he dies before me.

    Thanks.

    1. Rania Combs

      August 27, 2020 at 1:15pm

      Yes.

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