Inheritance laws in Texas have significant implications for residents, affecting how property and assets are distributed after death. Understanding these laws is crucial for planning your estate or dealing with the inheritance process.
The Law Office of Carey Thompson, PC, is a trusted authority on Texas inheritance laws. Our comprehensive guidance is backed by in-depth knowledge and a personalized approach. We ensure your estate planning needs are met efficiently and effectively, protect your legacy, and support your loved ones’ future. Contact us today for a consultation.
Is There an Estate Tax or Inheritance Tax in Texas?
Clients often ask about death taxes. Here’s what you need to know:
- No State Estate or Inheritance Tax: Texas does not impose a state estate or inheritance tax. This means that assets passed on to heirs are not subject to state taxation, although federal estate tax may apply for larger estates.
- Federal Estate Tax Threshold: Estates valued less than the federal exemption amount ($13. 61 million for individuals, $27.22 million for married couples for 2024) are exempt from estate taxes. These exemption amounts will be rolled back as of Dec. 31, 2025, without Congressional action to make them permanent.
- Gifts and Lifetime Transfers: Texas residents can also use gifting to reduce the size of their estate, as gifts up to $18,000 per recipient per year are exempt from federal gift tax.
Since tax laws are complex and subject to change, consulting an experienced Texas estate planning attorney is wise.
Dying With a Will
Creating a will in Texas allows individuals to specify how their assets should be distributed after death. It can designate guardians for minor children and appoint an executor to manage the estate’s settlement. Texas laws govern asset distribution without a will, which may not align with personal wishes. A will must meet Texas legal requirements to be valid, including being written, signed, and witnessed. When you work with our firm, you can be confident that your will is drafted correctly and reflects your intentions accurately.
Dying Without a Will
When a Texas resident dies without a will, their estate is considered “intestate.” Texas inheritance laws determine asset distribution, which can be more time-consuming and costly than when a valid will is in place. The estate is distributed to relatives based on a hierarchy defined by state law, starting with spouses and children and then to other family members if no direct descendants exist. This automatic distribution may not reflect the deceased’s wishes, highlighting the importance of having a will.
Community vs. Separate Property in Texas Inheritance Law
Understanding the distinction between community and separate property is essential for estate planning and inheritance because it impacts how assets are distributed. In Texas, property acquired during marriage is generally considered community property and is divided equally between spouses upon death. This includes:
- Income
- Real estate
- Personal property.
In contrast, property owned before marriage, inherited, or received as a gift is classified as separate property. Separate property is not subject to division upon death and goes directly to the heirs or as designated in a will.
Spouses and Children in Texas Inheritance Law
In the absence of a will, Texas law provides specific rules for how estates are divided among spouses and children. If a spouse and children survive the deceased:
Spouse’s Rights
The surviving spouse retains all community property if all children are the spouse’s children. If there are children from outside the marriage, the spouse keeps half of the community property, and the children receive the deceased’s half.
Children’s Rights
Children inherit separate property, with specific shares depending on whether there is a surviving spouse and the number of children. Understanding these nuances ensures estate planning reflects your intentions for your family’s future.
Non-Probate Texas Inheritances
Certain assets in Texas do not go through the probate process and can be transferred to beneficiaries without a will. These include:
- Life Insurance Policies: Proceeds are paid directly to the named beneficiaries.
- Retirement Accounts: Like life insurance, beneficiaries receive funds without probate.
- Jointly Owned Property: Automatically passes to the surviving owner(s) without probate.
Knowing which assets are non-probate can simplify estate planning and ensure seamless asset transfer.
What Else You Need to Know
Other essential aspects of inheritance law in Texas to be mindful of include:
- Homestead rights: Texas law protects the surviving spouse and minor children regarding the family home.
- Small estate affidavit: This process can simplify asset transfer without formal probate for estates valued at 75,000 or less.
- Guardianship: Texas law has provisions for appointing guardians to manage the inheritances of minors
Trust our estate planning attorneys to guide you on Texas inheritance law and help ensure your estate plan aligns with your wishes.
Get Legal Advice About Texas Inheritance Laws Today
Inheritance laws in Texas can be complex, but the Law Office of Carey Thompson is here to guide you. With our comprehensive understanding of trust and estate law and personalized approach, we carefully guide you through the estate planning and inheritance processes. Contact us today to get started.