Property possessed by either spouse during or on dissolution of marriage is presumed to be community property. Texas Family Code §3.003.
The community-property presumption can be rebutted by using a technique called “tracing.” Tracing is a method used to reinforce the inception of title rule. The title rule says that property gets its character from how and when a person first acquires ownership. Once property gets its character under the inception of title rule, the property will always retain that character even though it may go through several mutations.
If separate property has mutated since its inception of title, the property must be traced through each mutation (sale or exchange) to rebut the community-property presumption. See Cockerham v. Cockerham, 527 S.W.2d 162, 167 (Tex. 1975).
When a party claims that property bought during marriage is separate property because it was bought with separate-property funds, the party must establish that those funds came from separate property. See Attaguile v. Attaguile, 584 S.W.3d 163, 173 (TexApp.—El Paso 2018, no pet.)
When property is bought during marriage with cash, the law presumes it was purchased with community cash and thus is community property. To rebut this presumption, the party must trace the funds used to buy the property back to their separate-property origin and establish that those funds were actually used to buy the property. Merely testifying that the property was bought with separate funds or providing evidence that the person had possession of separate funds when the property was bought is not sufficient to rebut the presumption without evidence of where the funds came from.
John Herbig, Attorney at Law
Herbig Law Group, PLLC
https://conroelawyers.com
