Basic Fraudulent Transfer Law in Texas

The Texas Uniform Fraudulent Transfer Act (TUFTA) governs fraudulent transfers in Texas.

The Texas Business and Commerce Code, chapter 24 (Tex. Bus. & Com. Code §24.001 et seq.) is generally referred to as TUFTA. TUFTA is designed to stop debtors from transferring assets in a manner that keeps creditors from having access to those assets. TUFTA applies to a number of different types of transactions and can apply in ways that are surprising to the debtor.

But TUFTA is not the only Texas statute to address fraudulent transfers. Texas Property Code Section 42.004 is intended to prevent a debtor from converting nonexempt property into exempt property to prevent a creditor from collecting on an indebtedness.

Texas Family Code Sections 3.104 and 6.707 are intended to protect spouses and creditors of spouses from the effect of fraudulent transfers of community property or debts that were fraudulently incurred by the other spouse in the event of pending divorce of annulment.