Texas gives estate planners more good tools than almost any other state. There is no Texas estate tax and no inheritance tax. Independent administration lets an executor settle an estate with almost no court supervision. Transfer on death deeds move real property outside probate without a trust. The Texas homestead exemption is measured in acres rather than dollars, making it among the strongest creditor protections in the country. And community property with right of survivorship delivers both probate avoidance and a full step-up in basis.
The catch is that every one of those tools has conditions attached, and a Texas plan that fails to invoke them correctly loses their benefit entirely. An executor who is not granted independent authority in the will ends up in dependent administration with court approval required for routine acts. A transfer on death deed signed by an agent under a power of attorney is void. A will that purports to revoke a TOD deed does not revoke it.
The Holmes Law helps Texas clients use these tools properly — wills with independent executor language, revocable living trusts, transfer on death deeds, community property survivorship agreements, statutory durable powers of attorney, medical powers of attorney, and probate and trust administration.
Independent Administration: The Texas Advantage
Texas probate has a reputation for being manageable, and independent administration is the reason. Under Estates Code chapters 401 and 402, an independent executor — once appointed and qualified — may sell property, pay debts, distribute assets, and close the estate without seeking the probate court’s permission for each step. Compared with a supervised administration, the difference in time and legal fees is substantial.
Independent administration arises in two ways. The clean way is for the will to appoint an independent executor and expressly direct that no action be had in the probate court other than the probating and recording of the will and the return of any required inventory. The messier way, available where the will is silent or where there is no will, is for all of the distributees to agree to independent administration and ask the court to order it — which requires unanimity among people who may not agree about anything else.
Texas adds a further privacy benefit. Under Estates Code section 309.056, an independent executor may file an affidavit in lieu of inventory when there are no unpaid debts other than secured debts, taxes, and administration expenses. The detailed inventory is then prepared and provided to the beneficiaries but is not filed in the public record. Neighbors and marketers cannot look up what the decedent owned.
Muniment of Title
Texas offers a procedure that most states do not. Under Estates Code chapter 257, where there is a valid will and no unpaid debts other than those secured by real property, the court may admit the will to probate as a muniment of title without appointing any personal representative at all. The order itself operates as the link in the chain of title. It is fast, inexpensive, and ideal for the common case of a surviving spouse or child who needs to clear title to a house and nothing more.
Small Estate Affidavit
Where there is no will and the estate’s assets, excluding the homestead and exempt property, do not exceed $75,000, heirs may proceed by small estate affidavit. It is a narrow procedure with strict requirements, but for a modest intestate estate it can avoid administration entirely.
Texas Transfer on Death Deeds
Texas authorized transfer on death deeds effective September 1, 2015, in Estates Code chapter 114. A TOD deed lets an owner name a beneficiary who takes the property automatically at death. During life the owner keeps everything: the right to sell, mortgage, or revoke, and the homestead and tax exemptions. The beneficiary has no present interest and no creditor of the beneficiary can reach the property.
Used correctly it is an inexpensive and effective way to keep a house out of probate. Used carelessly it produces expensive problems. The rules that trip people up:
- The deed must be signed, acknowledged, and recorded in the county’s real property records before the owner’s death. A deed signed and left in a drawer is a nullity.
- A transfer on death deed may not be created by an agent acting under a power of attorney. Only the owner can sign one.
- A TOD deed cannot be revoked by a will. Revocation requires a recorded instrument of revocation or a recorded subsequent deed.
- The Legislature repealed the statutory forms in 2019. The fill-in-the-blank form still circulating online is no longer the statutory form, and homemade deeds routinely fail on legal description, acknowledgment, or contingent beneficiary problems.
- A TOD deed does nothing for incapacity, does not address what happens if the beneficiary predeceases you unless you say so, and passes the property subject to any mortgage and to certain estate claims.
For a single Texas homeowner leaving a house to one adult child, a TOD deed may be all that is needed. For anything more complicated — multiple properties, minor or protected beneficiaries, blended families, property in other states — a revocable living trust does the job more reliably.
Community Property and the Double Step-Up
Texas is a community property state. Property acquired during marriage other than by gift or inheritance belongs to the community, and each spouse owns an undivided one-half interest. That characterization delivers a federal income tax benefit that separate-property states cannot match.
Under Internal Revenue Code section 1014(b)(6), when one spouse dies, both halves of community property receive a new basis equal to fair market value. A Texas couple who bought a house for $120,000 in 1990 that is now worth $700,000 will see the survivor’s entire basis reset to $700,000. Sold at that price, there is no capital gain at all. In a separate-property state, roughly half the appreciation would still be taxable.
Texas spouses can also avoid probate on community property without giving up that benefit. Estates Code chapter 112 authorizes an agreement for community property with right of survivorship, and section 112.151(a) expressly provides that property held under such an agreement remains community property. The couple gets automatic transfer to the survivor and the double step-up. Converting community property to joint tenancy — the instinct many people bring from other states — sacrifices the tax benefit for no additional advantage. A survivorship agreement must be in writing and signed by both spouses, and title to real property should be examined to confirm the characterization is right.
The Texas Homestead
The Texas homestead exemption is a constitutional protection under article XVI, sections 50 through 52 of the Texas Constitution, and it is unlike anything most states offer. There is no dollar cap. The exemption is measured in acreage: up to 10 acres for an urban homestead, and up to 200 acres for a rural family homestead or 100 acres for a rural single adult. A ten-million-dollar house on an urban lot is protected from most unsecured creditors just as fully as a modest one.
The protection has limits — purchase money liens, property taxes, home equity loans that meet the constitutional requirements, and mechanic’s liens properly created can all reach a homestead. Texas also gives a surviving spouse and minor children the right to occupy the homestead, which can override a will’s disposition of the property, and provides for a family allowance and exempt personal property that take priority over creditor claims. All of that should be accounted for in the plan rather than discovered afterward.
Transferring a homestead into a revocable living trust generally preserves both the creditor protection and the homestead tax exemption when done properly, but the deed and the trust language need to be drafted with that in mind.
The Core Texas Estate Plan
Will With Independent Executor Language
This is the single most important sentence in a Texas will. Appointing an independent executor, waiving bond, and directing that no action be had in the probate court beyond probating the will and returning any required inventory is what converts a burdensome administration into a manageable one. Texas recognizes holographic wills wholly in the testator’s handwriting, but a handwritten will almost never contains the independent executor language, and proving it adds cost.
Revocable Living Trust
Because Texas probate is comparatively easy, trusts here are usually chosen for reasons other than cost: privacy, real property in more than one state, incapacity management, controlling the timing of distributions, protecting a beneficiary, or handling a blended family where the survivor should have use of assets but not the power to redirect them.
Statutory Durable Power of Attorney
Texas provides a statutory durable power of attorney form in Estates Code chapters 751 and 752. Amendments in recent years strengthened it considerably: a third party who refuses to accept a valid power of attorney without a statutory basis can be liable for the resulting costs and attorney’s fees. As in other states, “hot powers” such as gifting and creating or changing survivorship interests must be expressly granted. And, again, the agent cannot sign a transfer on death deed.
Medical Power of Attorney and Directive to Physicians
Texas separates the medical agent from the treatment instructions. A Medical Power of Attorney under Health and Safety Code chapter 166 appoints the agent; a Directive to Physicians and Family or Surrogates — the Texas living will — states your wishes about life-sustaining treatment. A Declaration of Guardian in Advance of Need lets you designate who would serve as your guardian if one ever became necessary, and a HIPAA authorization ensures your agent can obtain records. An out-of-hospital DNR may be appropriate in specific medical circumstances.
No Texas Estate Tax
Texas has no estate tax and no inheritance tax; the state inheritance tax provisions in Tax Code chapter 211 were repealed in 2015. Texas also has no state income tax, which means no state income tax on trusts. Only the federal estate tax applies.
Texas residents who own real property in states that do impose an estate tax — or who own mineral interests, ranch land, or business interests across state lines — should have those assets reviewed separately, since out-of-state real property is generally subject to the tax and probate rules of the state where it sits.
Ranch, Mineral, and Business Interests
Mineral and royalty interests are a distinctive Texas planning problem. They are real property interests, they may be spread across several counties, they fractionate rapidly across generations, and title errors surface years later when a division order arrives. Consolidating them into a trust or an entity, and keeping accurate records of what is owned and where, saves heirs enormous trouble.
The same discipline applies to ranch land and closely held businesses. Buy-sell agreements, life insurance to equalize among children who do and do not work in the operation, entity structures, and long-horizon gifting all take time to implement and cannot be improvised after a death.
Marital Agreements and Your Texas Estate Plan
Because Texas is a community property state, how assets are characterised between spouses decides what an estate plan can actually direct. A will or trust can only dispose of what the testator owns, and in a marriage that question is often less obvious than it looks — particularly where a business was started before the wedding, where separate funds were used to pay down a jointly titled home, or where one spouse has children from an earlier marriage. A prenuptial or postnuptial agreement settles the characterisation in advance instead of leaving it to be argued later. See Texas prenuptial and postnuptial agreements for how these are drafted and what makes them enforceable here.
Frequently Asked Questions About Texas Estate Planning
Do I need a living trust in Texas?
Many Texans do not. Independent administration, muniment of title, and transfer on death deeds handle a great deal. A trust becomes worthwhile for out-of-state real property, privacy, incapacity planning, blended families, or beneficiaries who should not receive assets outright.
Can my agent under a power of attorney sign a transfer on death deed for me?
No. Estates Code chapter 114 does not permit a TOD deed to be created by an agent. Only the property owner can sign one, which is why it should be handled while capacity is intact.
Can I revoke a transfer on death deed in my will?
No. Revocation requires a recorded instrument — either a revocation or a later deed — filed before death. A will provision purporting to revoke a TOD deed is ineffective.
Should we hold our house as joint tenants with right of survivorship?
For married Texans, usually not. A community property with right of survivorship agreement under Estates Code chapter 112 achieves the same automatic transfer while preserving the community character and the double step-up in basis.
Does Texas have an estate or inheritance tax?
No. Neither applies. Only the federal estate tax can reach a Texas estate, and it affects a small percentage of estates.
Speak With a Texas Estate Planning Attorney
Texas law is generous to people who use it correctly and unforgiving of documents that miss a required step. The Holmes Law assists Texas clients with wills naming independent executors, revocable and irrevocable trusts, transfer on death deeds, community property survivorship agreements, statutory durable and medical powers of attorney, homestead and title planning, mineral and business succession, and probate administration.
To discuss your Texas estate plan, contact the office to arrange a consultation. You may also want to review our page on Texas elder law.