Get What’s Truly Yours By Splitting Reimbursement Claims the Right Way

Divorce in Texas can be financially challenging. In certain cases, you may be reimbursed for expenses incurred during the marriage. This process is called reimbursement claims. Reimbursement claims in Texas come into play when separate property, like a house, is improved from marital funds. Learn more about the complexities of this divorce aspect with legal help.

Quick Summary:

• Reimbursement claims allow a spouse in Texas to get money back from the other spouse’s separate property estate if community funds were used to improve it. That can happen when one spouse uses community funds to pay the mortgage on the other spouse’s house or if one spouse works on the other spouse’s property without being paid. Reimbursement is crucial for ensuring a fair asset division during a divorce, as it accounts for the increased value of separate property due to community contributions.
• Texas law allows reimbursement for various reasons, including paying off a spouse’s debts, making improvements to their separate property, and reducing the amount owed on a separate property debt. However, courts won’t reimburse for everyday living expenses, child support, student loans, or minor contributions.
• Reimbursement claims in Texas divorces are flexible. Judges can split the reimbursed amount between spouses or order one spouse to pay the other directly. They can even award other assets, like a car, instead of cash.

What is a Reimbursement Claim in Texas?

In a Texas divorce, a reimbursement claim is like getting paid back for money you put into your spouse’s separate property during the marriage. That can happen if you used your marital funds to fix a house your spouse owned before marriage.

What are the Reasons for Reimbursement Claims in Texas?

Reimbursement claims exist to ensure a fair split of property when one spouse’s separate property increases in value due to the efforts of the community estate (money and contributions from both spouses during the marriage). Here are the main reasons for these claims:

• Fixing Up a Separate Property: Imagine a house one spouse owned before marriage. You use your shared marital funds to renovate the kitchen during the marriage. This renovation increases the house’s value, which is still considered the other spouse’s separate property. A reimbursement claim allows you to get compensated for the community funds used to improve the value of your individual property.

• Sweat Equity: Maybe your spouse inherited a fixer-upper before you got married. You dedicate countless weekends to renovating it without receiving any compensation for your labor. Your “time, toil, and talent” (TTT&E) contributed to the property’s increased value in this case. A reimbursement claim can help you get compensated for that uncompensated work that benefited the other spouse’s separate property.

• Paying Off Debts: One spouse owned a house with a mortgage before marriage. You use your shared marital funds to make mortgage payments during the marriage. These payments reduce the debt on the house, increasing its equity or ownership value. A reimbursement claim allows you to get compensated for the community funds used to pay down the debt on the other spouse’s separate property.

What are the Reimbursement Rules in the Texas Family Code?

In Texas, if one spouse invests significant time and effort in improving the other spouse’s property (such as a house owned before marriage) without adequate compensation, the marital estate may be entitled to reimbursement. This applies only if the contributing spouse wasn’t paid, or was underpaid, for their work, and if the other spouse controlled the property.

What are the Types of Reimbursements Allowed?

The Texas Family Code § 3.402 cites that the following reimbursements are allowed in a divorce. Remember, these are just some common situations. A judge might still consider other things before deciding. Reimbursement can be claimed in Texas if:

• Your spouse’s unsecured debts were paid off.
• You worked for little or no pay in a business your spouse controlled.
• Marital funds were used to pay down the principal amount of a debt on a property your spouse owned before marriage (or inherited during the marriage).
• You used marital funds to pay down the principal amount of a home equity loan used to buy or improve property.
• You used marital funds to pay down a debt secured by your spouse’s property where the creditor relies only on your spouse’s separate funds to repay, and the funds were used to buy or improve the property.
• Refinancing a debt that meets the above conditions and the refinancing reduces the principal amount.
• You directly improved your spouse’s property without borrowing money (think fixing up a house).
• You used marital funds to pay off a debt your spouse incurred before marriage.

What Cannot Be Reimbursed in Texas?

Since reimbursement claims are about getting money back for things you put into your spouse’s separate property during the marriage, there are some things you cannot get reimbursed for:

• Everyday living expenses (like groceries and rent)
• Payments you made for your kids (child support or alimony)
• Student loans your spouse took out before the marriage
• Small contributions you made (putting in a few light bulbs)
• Small debts you paid off (parking tickets)

If you’re unsure if something qualifies for reimbursement, talking to a lawyer is a good idea. They can help you figure out what you might be able to get back in your specific situation.

 

How Are Reimbursement Claims Settled By Judges?

Winning a reimbursement claim in Texas is not a sure thing. Even if the law allows it, the judge has the final say on how much you get and how you get it. This could play out in many ways: the judge might split the reimbursed amount between you and your spouse, like dividing the cost of that pool you built on your spouse’s property. Or the judge could order your spouse to pay you back directly. They could even give you something else of value, like a car, instead of cash.

Settle Reimbursement Claims in Texas The Right Way!

In Texas divorces, reimbursement claims allow a spouse to get compensated if they use marital funds to improve the value of the other spouse’s separate property, like a house owned before marriage. That can include things like money spent on renovations or the value of your unpaid work on the property. However, everyday living expenses or debts are not typically reimbursed.

For any family law and divorce-related concerns, know that our divorce attorney in The Alsandor Law Firm PC is ready to lend a helping hand. From paternity to adoption and even prenuptial agreements, our lawyer can do it all to ensure that reimbursement claims in Texas go smoothly and fairly. What are you waiting for? Time is of the essence. Reach out to us for a free consultation at The Alsandor Law Firm.