Understanding Community Property Liability Under Texas Law

Texas is a community property state, which means that marriage affects not only what you own—but also what you may owe. Many Texans are surprised to learn that they can sometimes be responsible for a spouse’s debts, even if they never signed the contract.

Understanding how Texas law treats marital debt is critical if you are facing divorce, a lawsuit, or creditor collection efforts.

This article explains when spouses may be liable for each other’s debts under Texas law—and how the Texas Family Code protects separate property.

Texas Is a Community Property State

Under Texas law, most property acquired during marriage is presumed to be community property.

Section 3.002 of the Texas Family Code provides:

“Community property consists of the property, other than separate property, acquired by either spouse during marriage.”

This presumption applies to income, business profits, real estate, and many financial accounts.

But community property rules also affect debt liability.

The Key Statute: Texas Family Code § 3.201

Spousal debt liability is primarily governed by Texas Family Code § 3.201.

The statute states in part:

“A person is personally liable for the acts of the person’s spouse only if:
(1) the spouse acts as an agent for the person; or
(2) the spouse incurs a debt for necessaries.”

It further provides:

“The community property subject to a spouse’s sole management, control, and disposition is subject to the liabilities incurred by that spouse before or during marriage.”

This law creates a layered system of liability.

Three Categories of Property in Texas

To understand debt liability, you must first understand how Texas classifies marital property.

1. Separate Property

Separate property includes:

• Property owned before marriage
• Gifts or inheritances
• Personal injury recoveries (with limited exceptions)

Texas Family Code § 3.001 defines separate property.

In most cases, your separate property is protected from your spouse’s debts.

2. Sole Management Community Property

Some community property is managed by only one spouse, including:

• Wages earned by that spouse
• Income from that spouse’s separate property
• Personal business income

This property is usually liable only for that spouse’s debts.

3. Joint Management Community Property

Property controlled by both spouses includes:

• Joint bank accounts
• Marital real estate
• Joint investments

This property is the most exposed to creditors.

It may be reached for many marital debts—even if only one spouse incurred them.

When Are You Personally Liable for Your Spouse’s Debts?

Under § 3.201, you are generally not personally liableunless one of these applies:

1. You Signed or Guaranteed the Debt

If you co-signed a loan, credit card, lease, or contract, you are fully liable.

Marriage alone does not eliminate contract liability.

2. Agency Relationship

If your spouse was acting as your legal agent—for example, running your business or managing authorized finances—you may be bound.

This is fact-specific and often litigated.

3. Necessaries Doctrine

Texas law recognizes liability for “necessaries,” such as:

• Medical care
• Essential housing
• Food and utilities

Courts may hold a spouse liable for these essential expenses, even without a signature.

Can Creditors Take Community Property for One Spouse’s Debt?

Yes—sometimes.

Under Texas Family Code § 3.202:

“A spouse’s separate property is not subject to liabilities of the other spouse unless both spouses are liable.”

But community property may be reached depending on management and control.

Typical Scenarios

Type of Debt

Property at Risk

Credit card in one name

That spouse’s income + sole management property

Business loan

Business assets + related community funds

Joint loan

All community property

Medical bills

Potentially joint property

Premarital debt

Debtor spouse’s income + property

This is why debt exposure is a major issue in divorce and judgment enforcement cases.

What Happens in Divorce?

In divorce, courts must divide both assets and debts in a “just and right” manner under Texas Family Code § 7.001.

However:

• A divorce decree does not automatically bind creditors
• Creditors can still pursue liable parties
• One spouse’s promise to pay does not erase legal liability

This often surprises former spouses years later.

What About Business Debts?

If your spouse owns a business, business debts may:

• Reach business assets
• Reach community income
• Sometimes reach joint accounts

LLC and corporate structures help, but they do not automatically eliminate community exposure.

This is a frequent issue in closely-held family businesses.

How to Protect Yourself from Spousal Debt Exposure

While no strategy is perfect, common protections include:

✔️ Separate Accounts

Maintain clearly segregated accounts when appropriate.

✔️ Prenuptial or Postnuptial Agreements

Marital property agreements can reclassify income and assets.

✔️ Careful Contract Review

Avoid casually co-signing or guaranteeing debts.

✔️ Business Structuring

Proper entity formation and accounting matter.

✔️ Legal Review

Early legal advice often prevents long-term liability.

Why This Issue Matters in Real Life

Spousal debt liability affects:

• Divorce settlements
• Judgment collection
• Business lawsuits
• Probate estates
• Bankruptcy filings
• Credit reporting

Many clients only learn about these rules after their accounts are frozen or property is threatened.

By then, options are limited.

When to Speak with a Texas Attorney

You should consult a lawyer if:

• A creditor is pursuing marital property
• You are divorcing with significant debts
• Your spouse operates a business
• You received a garnishment or levy notice
• You are being asked to co-sign

Early guidance can save thousands of dollars.

Final Thoughts

Texas community property law does not automatically make you responsible for your spouse’s debts—but it also does not fully shield you.

Under Texas Family Code §§ 3.201–3.203, liability depends on:

• How the debt was incurred
• Who controls the property
• Whether an agency or necessity exists
• How assets are classified

Understanding these rules is essential for protecting your financial future.