A person leaves an estate behind when he dies. The property in that estate usually passes to a person’s beneficiaries in accordance with his will. However, in Texas, not all property can be included in a will. Additionally, if a person dies without a will, inheritance law is set forth in Texas Probate Code, the intestate succession statutes.
Life Insurance and Retirement Accounts
In Texas, beneficiaries for life insurance policies and retirement accounts can't be put in a person’s will. Instead, the proceeds from a life insurance policy are paid to the beneficiary the decedent selected when she purchased the policy. If a decedent is receiving payments from a retirement account, or would have when she was old enough, those payments are made to the beneficiary she named when she set up the account. For both insurance proceeds and retirement payments, the named beneficiary can inherit these when he submits an original death certificate.
When the decedent owns property in Texas jointly with one or more other people, the decedent’s share of the property passes to the surviving owners. This is because joint property is owned with a right of survivorship. For example, if the decedent owned property with two brothers, his one-third share of the property is divided equally between the surviving owners. This means that the brothers maintain ownership of their own one-third shares and each inherit half of the decedent’s one-third share, making each brother’s total ownership one-half of the property.
A grantor is the person who creates a trust. In Texas, a grantor can put anything in trust to avoid probate upon her death. Bank accounts, real estate and personal property can all be put in trust and are passed to the beneficiary when the grantor dies. The grantor also names a trustee, who is responsible for managing the property in the trust. Initially, the grantor can name herself as the trustee to maintain control of her property, but she also names a successor trustee. The successor trustee takes over the duties of the trustee if she dies or becomes incapacitated. When the grantor dies, the trustee is responsible for distributing the assets in the trust to the beneficiary. A grantor can permit that the entire trust be distributed upon her death or can set forth that the trustee make monthly or annual distributions to ensure that the beneficiary doesn't wastefully spend all the assets in the trust.
Texas intestate laws are set forth in Chapter II of the Probate Code: Descent and Distribution. Section 45 of the code permits a spouse to inherit all of the decedent’s assets if the decedent didn't have children or if the children are also descendants of the surviving spouse. Texas follows community property laws, so anything the spouses acquired during the marriage is a marital asset. The surviving spouse is entitled to one-half of that property, his share of ownership; the decedent’s share of ownership passes to any of her children if those children aren't also the surviving spouse’s descendants. Section 38 of the code sets forth the inheritance rights of other heirs if the decedent isn't survived by a spouse or children. The decedent’s parents are the first to inherit, in equal shares, but if the parents are already deceased, the decedent’s siblings may inherit.
- Lawyers.com: Estate Planning in Texas (TX)
- My State Will: Texas Intestacy Laws
- Living Trust Texas: Living Trusts
- Federal Trade Commission. "Debts and Deceased Relatives." Accessed Oct. 13, 2020.
- Hanscom Federal Credit Union. "Here's The Difference Between An Heir And A Beneficiary." Accessed Oct. 13, 2020.
- HG.org Legal Resources. "What Happens to an IRA With No Beneficiary Designation?" Accessed Oct. 13, 2020.
Bernadette A. Safrath is an attorney who has been writing professionally since 2008. Safrath was published in Touro Law Center's law review and now writes legal articles for various websites. Safrath has a Bachelor of Arts in music from Long Island University at C.W. Post, as well as a Juris Doctor from Touro College.