How Do Texas Courts Handle Debt in a Divorce?

 Posted on November 27, 2025 in Property Division

As you may already know, dividing property is a standard part of the divorce process in Texas. That includes dividing any marital debt. In Texas, this can be complicated because the state follows community property laws. With help from an experienced Tarrant County, TX divorce lawyer, you can protect your credit and negotiate a fair settlement.

What Does "Community Property State" Mean?

Texas is one of a few states that follow the community property system. Under Texas Family Code § 3.002, community property includes all assets and debts acquired during the marriage. This means that both spouses are equally responsible for most financial obligations, even if only one person’s name is on a credit card or loan.

Separate property is different. According to Texas Family Code § 3.001, any property or debt that a spouse had before marriage usually stays separate. Courts generally do not divide these debts during a divorce unless the lines between separate and community property have become blurred. This distinction matters because determining whether a debt is community or separate is the first step in deciding who must pay it.

How Do Courts Divide Marital Debt in Texas?

Courts in Texas must divide community property and community debt in a way that is "just and right." This standard comes from Texas Family Code § 7.001, which means the division must be fair. Judges consider many factors when deciding how to divide debt. They look at each spouse’s income, earning potential, and how the debt was used during the marriage. A court may assign more debt to one spouse if that person earns more or uses more of the borrowed funds.

The judge may also review which spouse will keep property that is tied to a particular debt, such as a mortgage or vehicle loan. In some cases, a spouse who misused credit cards or took out secret loans may be required to pay those obligations alone.

Be mindful of the fact that a divorce decree divides debt between spouses but does not change your agreement with lenders. Even if a judge orders your ex-spouse to pay a certain loan, the creditor can still contact you for payment if your name remains on the account.

How Do Courts Handle Business and Tax Debts?

Dividing business and tax debts can be complex. When a couple owns a business together, the court must decide whether it is community or separate property. Debts linked to the business are often divided based on ownership interest and who benefited from the expenses. If one spouse ran the business and the other had little involvement, the court may assign the majority of the business debt to the managing spouse.

Tax debts require special attention. If you and your spouse filed joint tax returns, both of you are legally responsible for any unpaid taxes. The court may assign responsibility to one spouse, but the IRS can still pursue either of you for payment. In some situations, a spouse may qualify for "innocent spouse relief," which can remove liability if they were unaware of the other person’s tax actions.

Contact a Dallas, TX Divorce Attorney Today

Dividing debt in a Texas divorce involves more than splitting bills. It requires a careful review of financial records and a deep understanding of community property law. Attorney Michelle Poblenz has more than 25 years of legal experience that she brings to every case she handles. As a former prosecutor for the Dallas County District Attorney’s Office, she approaches each divorce with a strategy and attention to detail. Whether your case involves high-value assets, business debts, or complex financial issues, Law Office of Michelle Poblenz is committed to protecting your future and guiding you toward financial stability after divorce.

For more information, call 469-845-3031 today to schedule a consultation with our Tarrant County, TX divorce lawyer.