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Experts in Tracing Commingled Separate & Community Property Funds
If separate and community property funds are commingled in one or more financial
accounts, the funds are presumed to be entirely community property. If a spouse
wishes to establish that part of the funds are his or her separate property,
that spouse must prove the separate property interest by "clear and convincing
evidence." This usually requires a CPA schooled in the techniques of "tracing"
separate property to recreate daily balances in all affected accounts in order
to establish the separate and community property mix in each account at the time
of each deposit and each withdrawal. You must obtain deposit slips, checks and
statements on the accounts, and you must construct electronic spreadsheets to
calculate a running balance of separate and community property in each account.
There are certain "tracing methods" that must be applied. Some of these tracing
principles are established in case law and some in generally-accepted accounting
methods. Tracing methods can conflict with each other in certain circumstances.
In this day and time, a competent and experienced CPA is a necessity in a tracing
case. The attorney must know the tracing cases decided by Texas courts in the
past 40 years, to be able to effectively advocate which principles apply to
the facts of the case. Mr. Orsinger started working with tracing issues in 1976,
even before the personal computer was invented, and before CPAs became involved
in the task. He used pencil and paper to do the tracing himself in those early
days, and used up many erasers in the process. Mr. Orsinger wrote and lectured
on tracing issues during the period when modern tracing methods were developing,
and handled tracing issues in both trial and appellate courts.
[See Welder v. Welder, 794 S.W.2d 420 (Tex. App.-Corpus Christi 1990, no writ
history)] Nowadays, CPAs do most of the tracing work using electronic
spreadsheets. But, there are still many unanswered questions involving
tracing, and many points that can be argued. Having a lawyer with knowledge
and experience in tracing commingled property is a distinct advantage.
Board Certified in Family Law and Civil Appellate Law by the Texas Board of Legal Specialization.
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