Part 2: What are the Types of Reimbursements You can and Cannot Claim in a Texas Divorce?

Now that we’ve established why one spouse in a Texas divorce may file a reimbursement claim against the other spouse’s separate property on behalf of the community estate, we now proceed to understanding what exactly spouses can claim as reimbursement.

Under Section 3.402 of the Texas Family Code, the Court may award claims for reimbursement under the following circumstances.

1. As payment of one spouse to the other spouse’s (i.e. marital estate) unsecured liabilities (examples include credit card debt, taxes, interest, utility payments on a separate property);
2. To make up for insufficient compensation for one spouse’s work, time, talent, and effort delivered through his or her private business;
3. Reduction of the principal amount (balance excluding interest) of a debt secured by a lien on separate property owned before marriage, and paid at the time of marriage;
4. Reduction of the principal amount of a debt secured by a lien on separate property received as a gift or inheritance at the time of marriage;
5. Reduction of the principal amount of that part of a debt, including a home equity loan that was:
   • incurred during the marriage
   • secured by a lien on property
   • acquired to buy or pay for capital improvements to property;
6. Reduction of the principal amount of that part of a debt that was:
   • incurred during the marriage
   • secured by a lien on a spouse’s separate property
   • agreed upon by the creditor, who will seek payment solely from the separate marital estate of one spouse;
7. Refinancing of any of the aforementioned debts on numbers 3 to 6 resulting in reduction of their respective principal amounts;
8. Capital improvements to property other than through financing; and
9. The use of community property to pay one spouse’s separate unsecured debt.

On the other hand, the following five non-reimbursable expenses are specified under the Section 3.409 of the Texas Family Code:

• Child support and alimony payments to a former spouse
• Living expenses during the course of the marriage
• Contributions of property of a nominal value
• Payment of a nominal liability
• Student loan debt payments

All of these rules, however, are still subject to a premarital or postmarital agreement. As with other aspects of community property law in the Texas, spouses and fiancés can agree before getting married to override any default rules on reimbursement claims during a divorce.

It should also be pointed out that claims for reimbursement go both ways—one spouse can make a claim against the community property or the other spouse’s separate property. But for the most part, most claims in a Texas divorce involve a claim by the community property estate against one of the spouse’s separate property.

If you have more questions about reimbursement claims in Texas you would like to ask a qualified divorce attorney about, get in touch with Austin family law attorney Daniella Lyttle of the Lyttle Law Firm. Call our offices today at (512) 215-5225, or use our contact form to schedule a consultation about your case.