What Is Considered a High-Asset Divorce Case in Texas?

Texas considers any marriage with at least $1 million in marital or community property to be a high-asset divorce case. The list of items considered assets is lengthy, including everything from income, investment and retirement accounts, real estate, valuable property (such as artworks or jewelry), inheritances received during the marriage, digital assets, businesses or shares in businesses, or vehicles.

It’s important to understand that marital debts will offset the assets. If a couple has $2 million in assets but $1.5 million in debt, their net worth would be considered to be $500,000, not $2 million. This is vital because debts are considered during the divorce process, especially if the debts were largely incurred during the marriage.

Without a prenuptial or postnuptial agreement (see below), any assets considered community property will likely be divided equally during a divorce. Texas is one of a handful of states in the U.S. that recognizes community property.

What Steps Should Be Taken When Approaching a High-Asset Divorce?

  • First, find an experienced high-asset divorce attorney. These are highly complex cases that shouldn’t be undertaken on your own. 
  • Then work with the attorney to inventory all assets and debts. High-asset marriages often contain a multitude of assets, all of which need to be identified and evaluated before beginning divorce negotiations. It’s vital that neither party attempts to hide or misidentify assets, as that can adversely affect them if the court learns about it.
  • Once everything has been inventoried and professionally evaluated, if necessary (such as real estate or artwork), it’s time to consider which assets you want to keep, if possible. There are several considerations at this point:
    • Tax implications. How assets are divided can have different tax implications, which should be discussed with your attorney and accountant.
    • Emotional or sentimental attachment. Items with personal meaning, such as jewelry, may be high on this list.
    • Future income. Which assets continue to provide income and how much are major considerations. 
    • Child support arrangements. If there are minor children, how they’ll be provided for is crucial. This is one area where the concept of maintaining a current lifestyle may come into play, as the courts will want to ensure children are raised in a manner similar to what they’re accustomed to. 
    • Inheritance and property. Any inheritances or property must be scrutinized to see if they fall under community or separate property. This can be particularly complex and should be done with the assistance of an attorney.
      • It’s likely you’ll need to work with additional experts to inventory and evaluate these items. Your attorney may have references for professionals who are highly experienced here.
  • Once the inventory and evaluations are done and you’ve determined what your priorities are, negotiations can begin. Not surprisingly, this can be stressful. Have frank discussions with your attorney about prioritizing your wishes, what to expect, and how to prepare to compromise when necessary. While it’s challenging to remain calm at times, doing so whenever possible may help the process go more smoothly.

How Long Does a High-Asset Divorce Take to Be Finalized?

Because of the complexity and potential for animosity involved, these types of divorces may take longer than lower net-worth cases. You can expect to spend 12-18 months at a minimum, more if the inventory and evaluation step or the negotiation process takes longer.

If We’re Not Married Yet, What Should I Do to Protect My Assets in the Future?

Most people go into marriage assuming the marriage will last. Texas has one of the lowest divorce rates in the U.S., with a rate of just 1.4 per 1,000 population in 2021. But given that Texas’ population is more than 30 million, that’s still a sizeable number of divorces.

When sizable assets are brought into a marriage, future spouses should strongly consider drawing up a prenuptial contract, commonly called a prenup. It may not sound very romantic, but it actually can open the door to some honest, necessary conversations that may strengthen the relationship. Understanding each person’s financial situation and coming to an agreement about what happens if the marriage doesn’t last can be thought-provoking. It’s especially valuable given Texas’ status as a community property state. If one spouse is bringing a much higher amount of assets into the marriage, a prenup may help them protect those in the future.

What if We’re Already Married Without a Prenup?

There’s still time. Texas law allows for postnuptial agreements, which is similar to a prenup in that a legal document is developed determining the division of assets in the event of divorce. It’s not uncommon for a couple to realize after marriage that this type of arrangement could be beneficial. For example, suppose both spouses had similar incomes at the time of the marriage, but then one spouse decided to stop working to stay home and raise children. In that case, they may want to ensure they’ll be financially protected when their monetary contributions to the marriage are decreased.

What Should I Do if I’m Involved in a High-Assets Divorce Case in Texas?

Call the Cutrer Law Group at 817-813-8513 for a case evaluation. Divorce has been identified as one of life’s most stressful situations, and when significant assets are involved, it can be even more so. Our team of experienced, knowledgeable divorce attorneys can review the specifics of your case and help determine the best approach going forward.