Texas Asset Protection Case Law: Decisions on Homestead, Exemptions, Charging Orders, and Community Property

This page analyzes the most important Texas court decisions on asset protection: the homestead, the personal-property and retirement exemptions, the charging order, and a spouse’s liability for the other spouse’s debts.

What Qualifies as a Texas Homestead

A Texas homestead is a residence attached to the land, and the courts test the attachment rather than how the owner lives.

Norris v. Thomas, 215 S.W.3d 851 (Tex. 2007). Leading case. The owner lived on a 68-foot motor yacht and claimed it as his homestead. The court answered a certified question. A homestead “must rest on the land and have a requisite degree of physical permanency, immobility, and attachment to fixed realty.” 215 S.W.3d at 859. The dock’s water, power, and phone lines were not enough. Under the same test, a manufactured home set on blocks with utilities qualifies, and a trailer left on its wheels does not. Four justices dissented.

In re Crowell, 138 F.3d 1031 (5th Cir. 1998). Whether a homestead is urban or rural is a fact question decided on five factors. They are the land’s location relative to the city limits, the lot’s situs, municipal utilities and services, how the lot and its surroundings are used, and platted streets and blocks. 138 F.3d at 1034. A working cattle ranch inside the Keller city limits, ringed by subdivisions and served by city utilities, was urban.

In re Jay, 432 F.3d 323 (5th Cir. 2005). The stand-alone business homestead ended in November 1999. Before the amendment, a tract used only as a place of business could be a homestead. Since then, business use counts only when the same property is also an urban home. Section 41.002(d) applies the new definition to every homestead whenever created. 432 F.3d at 325. A tract the debtors leased and never lived on was not a homestead. The court left open whether that definition can constitutionally reach a home that qualified before it took effect.

Section 41.002 of the Texas Property Code sets the size limits. An urban homestead is up to ten acres. A rural homestead is up to 200 acres for a family, or 100 acres for a single adult, with the improvements. Decisions before November 1999 that recognized a business-only homestead no longer state the law on that point.

What Liens Can Reach a Texas Homestead

The Texas Constitution lists the only encumbrances a creditor can enforce against a homestead, eight today, and a lien outside the list is void whatever the owner signed.

Texas Land & Loan Co. v. Blalock, 76 Tex. 85, 13 S.W. 12 (1890). Leading case. The owners signed a recital that the land “is not our homestead” to get a loan. The recital created no estoppel, because the family lived on the land in open possession and the lender was charged with notice. To hold otherwise “would practically abrogate the Constitution.” 13 S.W. at 13. The lender was subrogated to the vendor’s lien its money paid off. It took no lien for the vendor’s attorney’s fees.

Alexander v. Wilson, 124 Tex. 392, 77 S.W.2d 873 (Tex. Comm’n App. 1935, opinion adopted). The limit on Blalock. The owners had moved to town, and nothing visible showed the farm was still their home. Their false recital that it was not their homestead did estop them. The court drew the line at possession, which the Blalock owners had and these owners did not.

Inwood North Homeowners’ Ass’n v. Harris, 736 S.W.2d 632 (Tex. 1987). A homeowners’ association lien could be foreclosed against the homestead, because the declaration creating it was recorded before the owners took title. When property is not yet a homestead at the time a lien attaches, “the homestead protections have no application even if the property later becomes a homestead.” 736 S.W.2d at 635. A homestead right “cannot rise any higher than the right, title or interest acquired by the homestead claimant.” Id. at 636.

Sayers v. Pyland, 139 Tex. 57, 161 S.W.2d 769 (1942). Cotenants partitioned land voluntarily and charged one share with owelty. The owelty was in the nature of purchase money and bound the share set aside to the homestead claimant. A cotenant cannot defeat the other’s right to partition “by moving onto the property and asserting a homestead right therein.” 161 S.W.2d at 774.

Heggen v. Pemelton, 836 S.W.2d 145 (Tex. 1992). A divorce court gave one spouse a money judgment to equalize the division and secured it with an equitable lien on the other spouse’s separate-property homestead. The lien was invalid because it fit none of the constitution’s categories. The holding is superseded in part. The constitution now permits an owelty of partition lien, including a debt one spouse owes the other from the award of a family homestead in a divorce. The decision still states the rule for a lien outside the list.

Benchmark Bank v. Crowder, 919 S.W.2d 657 (Tex. 1996). A lender’s loan paid off a valid federal tax lien on the homestead. The lender was subrogated to that lien and could foreclose under its deed of trust. The IRS had assessed nothing against the other spouse, who held a separate vested homestead interest and had to be compensated on the sale. 919 S.W.2d at 660–63. The court applied the constitution’s pre-1995 text.

LaSalle Bank National Ass’n v. White, 246 S.W.3d 616 (Tex. 2007). A home-equity lien on an agricultural homestead was void, and the lender forfeited the cash-out portion of the loan. The lender was still subrogated to the purchase-money and property-tax liens its proceeds had paid off. Section 50(e) “contains no language that would indicate displacement of equitable common law remedies was intended.” 246 S.W.3d at 619.

Higgins v. Bordages, 88 Tex. 458, 31 S.W. 52 (1895), and City of Wichita Falls v. Williams, 119 Tex. 163, 26 S.W.2d 910 (1930). A city’s special assessment for a sidewalk is not “taxes due thereon” under the constitution. No lien attaches to the homestead, and a judgment foreclosing one is void. In 1930 the court was asked on a certified question to overrule Higgins and declined. Later amendments had repeated the same words, so they carried the Higgins limit with them.

Florey v. Estate of McConnell, 212 S.W.3d 439 (Tex. App.-Austin 2006, pet. denied). A criminal defense lawyer took a deed of trust on the debtor’s homestead to secure his fee. The deed was void. A lien for attorney’s fees is not among the permitted encumbrances. Abandonment must be shown by evidence that is “undeniably clear,” and a void homestead lien “can never have any effect, even after the property is no longer impressed with the homestead character.” 212 S.W.3d at 444.

Laster v. First Huntsville Properties Co., 826 S.W.2d 125 (Tex. 1991). Homestead protection belongs only to a person with a present possessory interest. After the divorce the former wife held the homestead in the whole, and the former husband held a 26.17 percent remainder. He could validly mortgage that remainder. A creditor’s lien can attach to a future interest that carries no present right of possession. 826 S.W.2d at 130. A void homestead lien never revives, even after the homestead character ends.

Section 50 of article XVI of the Texas Constitution protects the homestead from forced sale for all debts except the encumbrances it lists. Those are purchase money, taxes, an owelty of partition, the refinance of a lien, work and material for new improvements, a compliant home-equity loan, a reverse mortgage, and the conversion of a manufactured-home lien. Decisions before 1995 quote an earlier text with three exceptions.

What the creditor holds	Enforceable against the homestead?	Authority
A purchase-money, tax, or home-improvement lien	Yes	Tex. Const. art. XVI, § 50(a)
A lien recorded before the property became a homestead	Yes	Inwood (Tex. 1987)
A refinance that paid off a valid lien, by subrogation	Yes	Benchmark Bank (Tex. 1996); LaSalle Bank (Tex. 2007)
An owelty lien from a divorce award of the homestead	Yes, under the amendment that answered Heggen	Tex. Const. art. XVI, § 50(a)(3)
A home-equity lien that fails the constitution’s conditions	No, though the lender keeps the liens it paid off	LaSalle Bank (Tex. 2007)
A deed of trust securing a lawyer’s fee	No	Florey (Tex. App.-Austin 2006)
A municipal special assessment	No	Higgins (Tex. 1895); Wichita Falls (Tex. 1930)
An abstracted judgment lien, while the property remains a homestead	No	Cadle Co. (Tex. App.-Fort Worth 2001); Fairfield (Tex. App.-Austin 2009)
A mortgage of a remainder interest with no present possession	Yes; the remainder is not homestead property	Laster (Tex. 1991)

Judgment Liens and the Homestead

An abstracted judgment lien does not attach to a Texas homestead while the property remains a homestead, so the owner sells free of it, and every Texas court of appeals to decide the question agrees.

Cadle Co. v. Harvey, 46 S.W.3d 282 (Tex. App.-Fort Worth 2001, pet. denied). Leading case. “A duly abstracted judgment never fixes a lien on the homestead so long as it remains a homestead.” The debtor may sell and pass title free of the lien. The lien attaches only if the debtor abandons the homestead before selling. 46 S.W.3d at 285. Here the buyer held equitable title from the day he took possession under the sale contract, and equitable title defeats the judgment creditor’s lien. Id. at 287.

Fairfield Financial Group, Inc. v. Synnott, 300 S.W.3d 316 (Tex. App.-Austin 2009, no pet.). The Austin court abandoned its own 1991 reading in Exocet, Inc. v. Cordes, 815 S.W.2d 350, which had held that an abstracted lien attaches but cannot be enforced. It joined the Fort Worth and San Antonio courts in holding that judgment liens “cannot attach to a homestead while that property remains a homestead.” 300 S.W.3d at 320. One spouse’s abandonment did not let the lien attach, because the other spouse’s undivided homestead interest protected the whole property. Id. at 321–23.

United States v. Johnson, 160 F.3d 1061 (5th Cir. 1998). The Fifth Circuit stated the sale rule the same way. In Texas “a grantor can convey his homestead free and clear of existing judgment liens” so long as he has not abandoned it first. 160 F.3d at 1064–65. The court noted that no Supreme Court of Texas opinion squarely addresses attachment.

Matter of Henderson, 18 F.3d 1305 (5th Cir. 1994). The Fifth Circuit, adopting Exocet, held that a judicial lien did “fix” against the homestead, though it could not be enforced. The cloud on title impaired the exemption, so the Chapter 7 debtor could avoid the lien under section 522(f)(1) of the Bankruptcy Code. 18 F.3d at 1309–11. That result favors the debtor. Courts holding that the lien never attached have denied the same relief and left the cloud in place. The Austin court has since abandoned Exocet.

Smith v. H.D. Smith Wholesale Drug Co. (Matter of McCombs), 659 F.3d 503 (5th Cir. 2011). A judgment lien that could not be enforced against the homestead before bankruptcy did not become enforceable against sale proceeds that the federal homestead cap made non-exempt. The trustee took the property with the state-law character it had in the debtor’s hands, “a property with an unenforceable lien.” 659 F.3d at 509. The court reserved the question whether the lien had attached at all.

Ramsey v. Davis, 261 S.W.3d 811 (Tex. App.-Dallas 2008, no pet.). A creditor refused to release an abstract of judgment that clouded a homestead. The creditor was liable for slander of title, and the court affirmed a $20,000 award. 261 S.W.3d at 817.

A title company that finds an abstract of judgment usually stops the sale. Section 52.0012 of the Property Code cures that. The owner records a homestead affidavit and a certificate of mailing, and sends the creditor notice by certified or registered mail. The creditor has 30 days to record a contradicting affidavit. If none is recorded, the affidavit operates as a release of record. A buyer or lender may then rely on it for 90 days, counted from the 31st day after the certificate was filed.

The affidavit and the rest of the homestead rules are set out under Texas homestead law.

Converting Non-Exempt Assets Into a Homestead

A Texas debtor who moves reachable money into a homestead keeps the protection even when the purpose was to defeat creditors, but an eve-of-bankruptcy transfer aimed at the federal cap can be undone.

Chase v. Swayne, 88 Tex. 218, 30 S.W. 1049 (1895). Leading case. An insolvent debtor may spend non-exempt money on a homestead and the homestead remains exempt, even if the purpose was to defeat creditors. Buying, paying down, or improving the home are all protected. The court reserved two cases. One is property another person paid for, held under a resulting trust. The other is property acquired by fraud, where title never passed. 88 Tex. at 222. No later decision has overruled or narrowed it. Florida later reached the same result in Havoco v. Hill.

Texas courts of appeals are split on whether that fraud exception reaches money spent improving a home the debtor already owned. No Supreme Court of Texas decision settles the split.

In re Moody, 77 B.R. 566 (S.D. Tex. 1987). A trustee’s fraudulent-conveyance and equitable-lien claims against property the debtor had designated as homestead were denied. Texas law “simply does not support setting aside conveyances of lawfully procured property” made to designate a constitutionally protected homestead. 77 B.R. at 577–78.

Hewitt v. Nocona Hospital District, No. 07-25-00334-CV (Tex. App.-Amarillo Apr. 30, 2026) (mem. op.). A debtor gave her homestead to family by gift deed. The deed was not a fraudulent transfer. A homestead is property “generally exempt under nonbankruptcy law,” so it is not an “asset” that the Texas fraudulent transfer act can reach. The creditor lacked standing, and the judgment was vacated. It is a memorandum opinion, and since 2003 a Texas court of appeals memorandum opinion in a civil case has precedential value.

In re Wiggains, 848 F.3d 655 (5th Cir. 2017). The limit. Sixty minutes before the husband filed his Chapter 7 petition, the spouses recorded a partition agreement splitting a $3.4 million community homestead into two separate halves to escape the federal cap. The agreement was an avoidable fraudulent transfer under section 548(a)(1)(A) of the Bankruptcy Code. No intent to defraud was shown, and none was needed, because “hinder, delay, or defraud” is disjunctive. The court saw no difference between keeping property in a spouse’s hands and keeping it from creditors. 848 F.3d at 662–63.

The Texas Uniform Fraudulent Transfer Act excludes from its definition of “asset” property “to the extent it is generally exempt under nonbankruptcy law.” Tex. Bus. & Com. Code § 24.002(2)(B). The homestead chapter of the Property Code has no conversion provision. The Bankruptcy Code caps the exemption where the debtor acquired the interest within 1,215 days of filing. It also reduces the exemption by value traceable to property the debtor disposed of to hinder, delay or defraud creditors. A 2025 Fifth Circuit decision confines the Wiggains reading to avoidance, not denial of discharge.

Homestead Sale Proceeds

Texas protects the proceeds of a homestead sale for six months. A state court protects all of them, and in bankruptcy the answer turns on when the sale happened and which chapter the debtor filed.

Taylor v. Mosty Bros. Nursery, Inc., 777 S.W.2d 568 (Tex. App.-San Antonio 1989, no writ). Section 41.001(c) gives homestead protection to the proceeds of a voluntary sale for six months, and the protection covers all of the money. The husband had abandoned the homestead, conveyed his interest, and left the state. His share was still protected, and the creditor could not force a sale to reach it. 777 S.W.2d at 569–70.

In re Frost, 744 F.3d 384 (5th Cir. 2014). A Chapter 13 debtor sold his exempted homestead during the case and did not reinvest the money within six months. He lost it to the estate. The six-month limit is “an integral feature of the Texas law applicable on the date of the filing,” so the snapshot rule did not help him. 744 F.3d at 387–89. The court repeated its earlier holdings. The proceeds exemption exists only to allow reinvestment in another homestead, and surplus money becomes non-exempt the moment a cheaper homestead is bought.

In re DeBerry, 884 F.3d 526 (5th Cir. 2018). Leading case. The Chapter 7 debtor owned his homestead at filing and sold it seven months later. He bought no new home and kept the exemption. Section 41.001(c) enlarges the exemption when a debtor sold before filing; it never shrinks the exemption of a debtor who still owned the home. 884 F.3d at 528–29. Frost “was a Chapter 13 case, which turns out to be a key distinction,” because a Chapter 13 estate captures post-filing property and a Chapter 7 estate does not. Id. at 529.

Section 41.001(c) of the Property Code shields a homestead claimant’s sale proceeds from seizure for six months after the sale. The rule has three parts. A sale before a bankruptcy filing gives six months to reinvest and no more. A sale during a Chapter 13 case loses the money if it is not reinvested in the window. A sale during a Chapter 7 case, where the debtor owned the home on the petition date, does not.

Personal Property, Wages, and Bank Accounts

Texas exempts personal property by a closed list under a dollar cap, exempts current wages from garnishment and seizure, and leaves a deposited paycheck open to garnishment.

In re Crockett, 158 F.3d 332 (5th Cir. 1998). The list is closed, and what it leaves out is not exempt. A wave runner was not “athletic or sporting equipment.” The category for tools of a trade expressly includes “boats and motor vehicles,” and the sporting category does not, so “the Texas legislature made a conscious choice to omit such items.” 158 F.3d at 334–35. Liberal construction does not override the text. The court also noted that the older “reasonably necessary” requirement had been deleted, which makes the decisions applying it of little help.

Caulley v. Caulley, 806 S.W.2d 795 (Tex. 1991). Leading case on turnover. A trial court ordered a debtor to turn over most of his net monthly wages to a receiver. The order was reversed. A 1989 amendment bars any turnover order that reaches “the proceeds of, or the disbursement of, property exempt under any statute.” That language “necessarily prohibits the turnover of the proceeds of current wages.” 806 S.W.2d at 797–98. The court did not reach the constitutional question. The concurrence would have decided it.

General Electric Capital Corp. v. ICO, Inc., 230 S.W.3d 702 (Tex. App.-Houston [14th Dist.] 2007, pet. denied). A severance payment is current wages. The exemption turns on whether the money is compensation for personal service, not on its label. 230 S.W.3d at 705–07. The exemption can be lost when the employee leaves wages under the employer’s control or deposits them with someone else. But it “has been held destroyed only when the employee has treated his employer as a bank.” Id. at 709. Negotiating rather than suing to collect did not forfeit it.

Goebel v. Brandley, 174 S.W.3d 359 (Tex. App.-Houston [14th Dist.] 2005, pet. denied). A mother bought savings bonds in her children’s names by payroll deduction, beginning years before the judgment. The purchases were not fraudulent transfers. Current wages are exempt, and exempt property is not an “asset” under the fraudulent transfer act. 174 S.W.3d at 364–66. The wages were never received. Wages “cease to be ‘current'” once they “are paid to and received by the wage earner.”

Three provisions overlap. The constitution’s article XVI, section 28 bars garnishing current wages for personal service, except to enforce court-ordered child support or spousal maintenance. Section 63.004 of the Civil Practice and Remedies Code discharges the garnishee as to current wages. Section 42.001(b)(1) of the Property Code exempts current wages outside the personal-property cap. The creditor’s choice of process decides the outcome. The turnover statute cannot reach wages even after they are paid. No Texas statute exempts wages once they sit in a bank account, and a garnishment of the account reaches them.

A writ served on the bank reaches a deposited paycheck, and what stays exempt in the account follows Texas wage and bank account law.

Retirement Accounts and IRAs

Texas exempts retirement plans and IRAs with no dollar limit, inherited IRAs included, and a Texas debtor in bankruptcy keeps an inherited IRA only by electing the Texas exemptions instead of the federal ones.

In re Kara, 573 B.R. 696 (Bankr. W.D. Tex. 2017). Leading case. A Chapter 7 debtor who elected the Texas exemptions could exempt an inherited IRA. The statute lists inherited IRAs by name. Clark v. Rameker, which denied the federal exemption to inherited IRAs, construed only the federal provision. Adopting an Arizona court’s reasoning, the court treated the federal exemption as “the floor for exemptions for retirement funds, not the ceiling.” 573 B.R. at 700. A federal district court affirmed that reading in 2023, in an unpublished order. No appellate court has ruled.

In Clark v. Rameker, 573 U.S. 122 (2014), the Supreme Court held unanimously that an inherited IRA holds no money set aside for the heir’s own retirement, so the Bankruptcy Code’s retirement-funds exemption does not cover it. The decision abrogated the Fifth Circuit’s contrary ruling in Chilton v. Moser, 674 F.3d 486 (5th Cir. 2012). Texas lets a debtor choose between the state and federal exemption sets, and the election decides whether an inherited IRA survives a Texas bankruptcy.

In re Jarboe, 365 B.R. 717 (Bankr. S.D. Tex. 2007). Superseded. On a question of first impression, the court held that an IRA inherited from a non-spouse did not qualify under the Texas statute. The statute then said nothing about inherited accounts. The Legislature later added inherited IRAs and inherited Roth IRAs, and Kara records that Jarboe “relied on the 2006 version.” 573 B.R. at 702. Its burden rule still stands. Proof that an account is an IRA establishes the exemption unless evidence shows the account does not qualify.

Nu-Way Energy Corp. v. Delp, 205 S.W.3d 667 (Tex. App.-Waco 2006, pet. denied). The debtor used IRA money to buy a secured claim, and the purchase released a guaranty he had signed personally. That was a prohibited transaction. The account stopped being an IRA under the Internal Revenue Code, and it “is no longer exempt from creditors under section 42.0021.” 205 S.W.3d at 682–83. Distributions he spent on a non-exempt asset rather than rolling over were not exempt either.

Matter of Volpe, 943 F.2d 1451 (5th Cir. 1991). ERISA does not preempt the Texas exemption, and the statute does not limit how many accounts a debtor may exempt. Seven IRAs and a profit-sharing plan were all exempt. Nothing in the section “clearly and unmistakably” limits the count, and Texas construes exemption statutes liberally. 943 F.2d at 1453–54.

In re Hawk, 871 F.3d 287 (5th Cir. 2017). A Chapter 7 debtor exempted an IRA without objection, then withdrew the money and did not roll it over within 60 days. The account stayed out of the estate. The exemption is fixed on the petition date. The court distinguished Chapter 13.

Section 42.0021 of the Property Code exempts a “qualified savings plan.” The defined term covers retirement plans, IRAs and Roth IRAs, inherited IRAs and inherited Roth IRAs, health savings accounts, and education and ABLE accounts, and the section sets no dollar limit. Money distributed from a plan keeps the exemption for 60 days, and indefinitely if it is rolled into another plan. The exemption fails when the account itself fails to qualify under the Internal Revenue Code. The decisions above construe earlier versions of the section, which the Legislature restructured in 2019.

A Texan’s retirement account and IRA protection ends at that 60-day window, at a disqualified account, and, in bankruptcy, at the federal election.

Charging Orders Against LLCs and Partnerships

A charging order is a lien on a Texas LLC member’s interest that gives the judgment creditor only the distributions the company would have paid the member. It is the creditor’s exclusive remedy against that interest, single-member companies included, and the interest is a non-exempt asset the creditor still cannot take.

Pajooh v. Royal West Investments LLC, Series E, 518 S.W.3d 557 (Tex. App.-Houston [1st Dist.] 2017, no pet.). Leading case. A judgment creditor’s only remedy against a debtor’s entity interest is the charging order, even where the judgment debtors own the whole entity and no innocent co-owner exists. 518 S.W.3d at 563–66. The court declined to follow the single-owner reasoning of In re Albright and Olmstead v. FTC. It affirmed a receivership over the judgment debtors to monitor distributions and carry out the charging order. Id. at 567.

The wholly owned entity in Pajooh was a limited partnership. The partnership statute carries the same exclusive-remedy language as the section governing limited liability companies.

Klinek v. LuxeYard, Inc., 672 S.W.3d 830 (Tex. App.-Houston [14th Dist.] 2023, no pet.). A member’s LLC interest is a non-exempt asset. Even so, an order turning it over to the creditor was an abuse of discretion, because the charging order is exclusive and its lien cannot be foreclosed. 672 S.W.3d at 839. The four situations allowing turnover are distributions already in the member’s hands, turnover that polices an existing charging order, an LLC operating no business, and a creditor that is the LLC itself. Id. at 839–40.

Gillet v. Zupt, LLC, 523 S.W.3d 749 (Tex. App.-Houston [14th Dist.] 2017). The entity-as-creditor exception, decided as an issue of first impression. Turnover of a membership interest was proper for two reasons together. The judgment creditor was the LLC itself, so the rule’s purpose of protecting the business from an outside creditor did not apply. And the judgment expressly awarded the interest from one party to the other. 523 S.W.3d at 758. Both conditions are required. In 2024 the same court reserved whether to adopt the exception for a dormant company, over a dissent.

Jiao v. Xu, 28 F.4th 591 (5th Cir. 2022). The Fifth Circuit adopted the Gillet exception as its prediction of Texas law. It noted that the Supreme Court of Texas “has not spoken to the interplay between turnover orders and § 101.112(d).” 28 F.4th at 600–01. A declaration fixing a member’s ownership percentage does not satisfy a judgment out of the interest, so the statute does not apply to it. Id. at 599.

Thomas v. Hughes, 27 F.4th 363 (5th Cir. 2022). A court can enter a post-judgment injunction alongside a charging order. The statute does not displace a court’s inherent power to enforce its judgment. A jury had found that the debtor, the LLC’s sole member, made fraudulent transfers. Section 52.006 of the Civil Practice and Remedies Code supported an order forbidding her to transfer the LLC’s property or her interest without leave of court. The LLC itself was not liable on the judgment. It could not be enjoined, and the court struck it from the order.

Matter of Canada, 167 F.4th 280 (5th Cir. 2026). The open question. The Fifth Circuit asked the Supreme Court of Texas whether an LLC membership interest is “exempt property in a federal bankruptcy proceeding, based on section 101.112 of the Texas Business Organizations Code.” Both lower courts had held a 70 percent interest not exempt. The panel noted that Texas courts have repeatedly said so, while the statute’s “exclusive remedy” language may point the other way. As of September 2026 no answer has issued, and the statute’s effect in a Texas bankruptcy is unsettled.

Section 101.112 of the Business Organizations Code lets a court charge a member’s interest on a judgment creditor’s application. The charging order creates a lien that no creditor may foreclose. The creditor gets only the right to receive distributions. The creditor may not take possession of company property or exercise other remedies against it. A 2023 amendment states that the section applies to single-member and multiple-member companies alike, and the act says it was meant only to clarify existing law. No decision construes it.

The four situations that allow turnover, and what a creditor can add beside the order, are set out under Texas charging order law.

Community Property and a Spouse’s Creditors

Marriage creates no liability for a spouse’s debts in Texas, and community property that one spouse alone manages answers for the other spouse’s debts only when the debt is a tort.

Tedder v. Gardner Aldrich, LLP, 421 S.W.3d 651 (Tex. 2013). Leading case. “Marriage itself does not create joint and several liability.” A spouse answers personally for the other’s acts only as an agent, or for necessaries. A “community debt” means “nothing more than that some community property is liable for its satisfaction.” 421 S.W.3d at 654–55. Section 3.202(c) makes community property the debtor spouse solely or jointly manages liable for that spouse’s debts. “It does not impose liability” on the other spouse. Id. at 655 n.21. A spouse’s divorce legal fees are not necessaries.

In re Hall, 559 B.R. 463 (Bankr. S.D. Tex. 2016). A creditor of one spouse may collect from that spouse’s separate property, the community property that spouse alone manages, and jointly managed community property. That is so “without regard to whether the debt was incurred for community or separate activities.” 559 B.R. at 468. It may not reach the other spouse’s separate property or the community property the other spouse alone manages. Under section 3.102 that is what the other spouse would have owned if single, personal earnings included.

Montemayor v. Ortiz, 208 S.W.3d 627 (Tex. App.-Corpus Christi-Edinburg 2006, pet. denied). A 1990 judgment against the husband rested on promissory notes. It could not be executed against the wife’s business, which was community property she alone managed, because a contract creditor of one spouse cannot reach what the other spouse solely manages. 208 S.W.3d at 640–41. The outcome turns on whether the underlying debt sounds in tort or contract.

Section 3.202 of the Family Code sets the rules. A spouse’s separate property is not liable for the other spouse’s debts unless both are liable. What one spouse alone manages is beyond the reach of the other’s premarital debts and of the other’s non-tort marital debts. All community property answers for a tort either spouse commits during marriage. Under section 4.106, a partition or exchange agreement between spouses is void as to a creditor who was already there and whose rights it was intended to defraud.

What a creditor of one spouse reaches under those rules is set out in Texas community property law.

Asset protection planning in Texas starts from these rules and from what they leave exposed, which is the cash and the brokerage accounts no Texas exemption reaches.