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Under Texas law, the ownership of real property held jointly by married couples is subject to certain assumptions that can impact estate planning and property transfer.
By default, under the Texas Constitution, real property purchased during a marriage is presumed to be community property, but without rights of survivorship. This means that, unless otherwise specified, each spouse owns a separate, undivided one-half interest in the property, and they are considered tenants in common. As tenants in common, the deceased spouse’s share of the property must go through probate or a similar process to transfer ownership to the surviving spouse. This process can complicate matters when attempting to sell or refinance the property, as the deceased spouse’s interest must first be cleared. This default rule contrasts with financial accounts held by married couples, which are presumed to be joint accounts with rights of survivorship unless explicitly stated otherwise.
A complication arises when one spouse has children from a prior relationship. Without a will or a survivorship agreement in place, Texas heirship laws dictate that the deceased spouse’s one-half interest in the property will pass to their children, not the surviving spouse. In such cases, the surviving spouse may end up owning the property 50/50 with their stepchildren.
To avoid these complications, married couples who wish to hold property as community property with rights of survivorship must include specific language in their deed at the time of purchase. Both spouses must sign the deed to confirm their agreement to the survivorship terms.
For couples who already own property, a separate signed and recorded survivorship agreement can be executed. This agreement creates a “Community Property Survivorship Agreement” that ensures the property will automatically pass to the surviving spouse without the need for probate.
If the deed does not contain survivorship language or a separate survivorship agreement is not in place, the property will be treated as community property without rights of survivorship, requiring probate to transfer ownership.
Strategies for Bypassing Probate
- Texas Transfer on Death Deed: Texas law allows for a transfer on death deed, which enables property owners to designate beneficiaries who will inherit the property upon their death, bypassing probate. This can be combined with a community property survivorship agreement, ensuring the property passes seamlessly from one spouse to the survivor, and then to the designated beneficiaries.
- Transferring Property to a Trust: Property can also be placed into a revocable or other types of trust, ensuring the property is transferred according to the terms of the trust without going through probate.
- Adding Survivorship Language to the Deed: When acquiring new property, married couples can request that “joint with right of survivorship” language be included in their deed. Both spouses must sign the deed to confirm their consent to these terms.
- Creating a Survivorship Agreement for Existing Property: For property already owned, a separate survivorship agreement can be executed between the couple to establish joint ownership with right of survivorship. This agreement must be signed by both spouses and recorded in the county deed records.
By understanding these options and taking proactive steps, married couples can avoid probate and ensure their real property is transferred smoothly to their desired beneficiaries. To learn more, we invite you to schedule a consultation with FOREVER LEGAL by visiting our consultation page. Our mission is to deliver personalized, sophisticated advocacy designed to address your unique needs. We encourage you to stay informed about our latest insights and updates by subscribing to our mailing list. Additionally, explore our Resource Center for comprehensive, downloadable Elite Guidebooks on business law, probate and estate planning, and guardianship law.
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