Texas 2015 - 84th Regular

Texas House Bill HB703 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New	Differences
1	1	84R18653 CLG-F
2	2	By: Farrar, Rodriguez of Bexar, Keffer H.B. No. 703
3	3	Substitute the following for H.B. No. 703:
4	4	By: Farrar C.S.H.B. No. 703
5	5
6	6
7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to authorizing a revocable deed that transfers real
10	10	property at the transferor's death.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Subtitle C, Title 2, Estates Code, is amended by
13	13	adding Chapter 114 to read as follows:
14	14	CHAPTER 114. TRANSFER ON DEATH DEED
15	15	SUBCHAPTER A. GENERAL PROVISIONS
16	16	Sec. 114.001. SHORT TITLE. This chapter may be cited as the
17	17	Texas Real Property Transfer on Death Act.
18	18	Sec. 114.002. DEFINITIONS. (a) In this chapter:
19	19	(1) "Beneficiary" means a person who receives real
20	20	property under a transfer on death deed.
21	21	(2) "Designated beneficiary" means a person
22	22	designated to receive real property in a transfer on death deed.
23	23	(3) "Joint owner with right of survivorship" or "joint
24	24	owner" means an individual who owns real property concurrently with
25	25	one or more other individuals with a right of survivorship. The term
26	26	does not include a tenant in common or an owner of community
27	27	property with or without a right of survivorship.
28	28	(4) "Person" has the meaning assigned by Section
29	29	311.005, Government Code.
30	30	(5) "Real property" means an interest in real property
31	31	located in this state.
32	32	(6) "Transfer on death deed" means a deed authorized
33	33	under this chapter and does not refer to any other deed that
34	34	transfers an interest in real property on the death of an
35	35	individual.
36	36	(7) "Transferor" means an individual who makes a
37	37	transfer on death deed.
38	38	(b) In this chapter, the terms "cancel" and "revoke" are
39	39	synonymous.
40	40	Sec. 114.003. APPLICABILITY. This chapter applies to a
41	41	transfer on death deed executed and acknowledged on or after
42	42	September 1, 2015, by a transferor who dies on or after September 1,
43	43	2015.
44	44	Sec. 114.004. NONEXCLUSIVITY. This chapter does not affect
45	45	any method of transferring real property otherwise permitted under
46	46	the laws of this state.
47	47	Sec. 114.005. UNIFORMITY OF APPLICATION AND CONSTRUCTION.
48	48	In applying and construing this chapter, consideration must be
49	49	given to the need to promote uniformity of the law with respect to
50	50	the subject matter of this chapter among states that enact a law
51	51	similar to this chapter.
52	52	Sec. 114.006. RELATION TO ELECTRONIC SIGNATURES IN GLOBAL
53	53	AND NATIONAL COMMERCE ACT. This chapter modifies, limits, and
54	54	supersedes the federal Electronic Signatures in Global and National
55	55	Commerce Act (15 U.S.C. Section 7001 et seq.), except that this
56	56	chapter does not modify, limit, or supersede Section 101(c) of that
57	57	Act (15 U.S.C. Section 7001(c)) or authorize electronic delivery of
58	58	any of the notices described in Section 103(b) of that Act (15
59	59	U.S.C. Section 7003(b)).
60	60	SUBCHAPTER B. AUTHORIZATION, EXECUTION, AND REVOCATION OF TRANSFER
61	61	ON DEATH DEED
62	62	Sec. 114.051. TRANSFER ON DEATH DEED AUTHORIZED. An
63	63	individual may transfer the individual's interest in real property
64	64	to one or more beneficiaries effective at the transferor's death by
65	65	a transfer on death deed.
66	66	Sec. 114.052. TRANSFER ON DEATH DEED REVOCABLE. A transfer
67	67	on death deed is revocable regardless of whether the deed or another
68	68	instrument contains a contrary provision.
69	69	Sec. 114.053. TRANSFER ON DEATH DEED NONTESTAMENTARY. A
70	70	transfer on death deed is a nontestamentary instrument.
71	71	Sec. 114.054. CAPACITY OF TRANSFEROR; USE OF DURABLE POWER
72	72	OF ATTORNEY. (a) The capacity required to make or revoke a
73	73	transfer on death deed is the same as the capacity required to make
74	74	a contract.
75	75	(b) A transfer on death deed may not be created through use
76	76	of a durable power of attorney.
77	77	Sec. 114.055. REQUIREMENTS. To be effective, a transfer on
78	78	death deed must:
79	79	(1) except as otherwise provided in Subdivision (2),
80	80	contain the essential elements and formalities of a recordable
81	81	deed;
82	82	(2) state that the transfer of an interest in real
83	83	property to the designated beneficiary is to occur at the
84	84	transferor's death; and
85	85	(3) be recorded before the transferor's death in the
86	86	deed records in the county clerk's office of the county where the
87	87	real property is located.
88	88	Sec. 114.056. NOTICE, DELIVERY, ACCEPTANCE, OR
89	89	CONSIDERATION NOT REQUIRED. A transfer on death deed is effective
90	90	without:
91	91	(1) notice or delivery to or acceptance by the
92	92	designated beneficiary during the transferor's life; or
93	93	(2) consideration.
94	94	Sec. 114.057. REVOCATION BY CERTAIN INSTRUMENTS; EFFECT OF
95	95	WILL OR MARRIAGE DISSOLUTION. (a) Subject to Subsections (d) and
96	96	(e), an instrument is effective to revoke a recorded transfer on
97	97	death deed, or any part of it, if the instrument:
98	98	(1) is one of the following:
99	99	(A) a subsequent transfer on death deed that
100	100	revokes the preceding transfer on death deed or part of the deed
101	101	expressly or by inconsistency; or
102	102	(B) except as provided by Subsection (b), an
103	103	instrument of revocation that expressly revokes the transfer on
104	104	death deed or part of the deed;
105	105	(2) is acknowledged by the transferor after the
106	106	acknowledgment of the deed being revoked; and
107	107	(3) is recorded before the transferor's death in the
108	108	deed records in the county clerk's office of the county where the
109	109	deed being revoked is recorded.
110	110	(b) A will may not revoke or supersede a transfer on death
111	111	deed.
112	112	(c) If a marriage between the transferor and a designated
113	113	beneficiary is dissolved after a transfer on death deed is
114	114	recorded, a final judgment of the court dissolving the marriage
115	115	operates to revoke the transfer on death deed as to that designated
116	116	beneficiary if notice of the judgment is recorded before the
117	117	transferor's death in the deed records in the county clerk's office
118	118	of the county where the deed is recorded, notwithstanding Section
119	119	111.052.
120	120	(d) If a transfer on death deed is made by more than one
121	121	transferor, revocation by a transferor does not affect the deed as
122	122	to the interest of another transferor who does not make that
123	123	revocation.
124	124	(e) A transfer on death deed made by joint owners with right
125	125	of survivorship is revoked only if it is revoked by all of the
126	126	living joint owners.
127	127	(f) This section does not limit the effect of an inter vivos
128	128	transfer of the real property.
129	129	SUBCHAPTER C. EFFECT OF TRANSFER ON DEATH DEED; LIABILITY OF
130	130	TRANSFERRED PROPERTY FOR CREDITORS' CLAIMS
131	131	Sec. 114.101. EFFECT OF TRANSFER ON DEATH DEED DURING
132	132	TRANSFEROR'S LIFE. During a transferor's life, a transfer on death
133	133	deed does not:
134	134	(1) affect an interest or right of the transferor or
135	135	any other owner, including:
136	136	(A) the right to transfer or encumber the real
137	137	property that is the subject of the deed;
138	138	(B) homestead rights in the real property, if
139	139	applicable; and
140	140	(C) ad valorem tax exemptions, including
141	141	exemptions for residence homestead, persons 65 years of age or
142	142	older, persons with disabilities, and veterans;
143	143	(2) affect an interest or right of a transferee of the
144	144	real property that is the subject of the deed, even if the
145	145	transferee has actual or constructive notice of the deed;
146	146	(3) affect an interest or right of a secured or
147	147	unsecured creditor or future creditor of the transferor, even if
148	148	the creditor has actual or constructive notice of the deed;
149	149	(4) affect the transferor's or designated
150	150	beneficiary's eligibility for any form of public assistance,
151	151	subject to applicable federal law;
152	152	(5) constitute a transfer triggering a "due on sale"
153	153	or similar clause;
154	154	(6) invoke statutory real estate notice or disclosure
155	155	requirements;
156	156	(7) create a legal or equitable interest in favor of
157	157	the designated beneficiary; or
158	158	(8) subject the real property to claims or process of a
159	159	creditor of the designated beneficiary.
160	160	Sec. 114.102. EFFECT OF SUBSEQUENT CONVEYANCE ON TRANSFER
161	161	ON DEATH DEED. An otherwise valid transfer on death deed is void as
162	162	to any interest in real property that is conveyed by the transferor
163	163	during the transferor's lifetime after the transfer on death deed
164	164	is executed and recorded if:
165	165	(1) a valid instrument conveying the interest is
166	166	recorded in the deed records in the county clerk's office of the
167	167	same county in which the transfer on death deed is recorded; and
168	168	(2) the recording of the instrument occurs before the
169	169	transferor's death.
170	170	Sec. 114.103. EFFECT OF TRANSFER ON DEATH DEED AT
171	171	TRANSFEROR'S DEATH. (a) Except as otherwise provided in the
172	172	transfer on death deed, this section, or any other statute or the
173	173	common law of this state governing a decedent's estate, on the death
174	174	of the transferor, the following rules apply to an interest in real
175	175	property that is the subject of a transfer on death deed and owned
176	176	by the transferor at death:
177	177	(1) if the designated beneficiary survives the
178	178	transferor by 120 hours, the interest in the real property is
179	179	transferred to the designated beneficiary in accordance with the
180	180	deed;
181	181	(2) the interest of a designated beneficiary that
182	182	fails to survive the transferor by 120 hours lapses,
183	183	notwithstanding Section 111.052;
184	184	(3) subject to Subdivision (4), concurrent interests
185	185	are transferred to the beneficiaries in equal and undivided shares
186	186	with no right of survivorship; and
187	187	(4) notwithstanding Subdivision (2), if the
188	188	transferor has identified two or more designated beneficiaries to
189	189	receive concurrent interests in the real property, the share of a
190	190	designated beneficiary who predeceases the transferor lapses and is
191	191	subject to and passes in accordance with Subchapter D, Chapter 255,
192	192	as if the transfer on death deed were a devise made in a will.
193	193	(b) If a transferor is a joint owner with right of
194	194	survivorship who is survived by one or more other joint owners, the
195	195	real property that is the subject of the transfer on death deed
196	196	belongs to the surviving joint owner or owners. If a transferor is
197	197	a joint owner with right of survivorship who is the last surviving
198	198	joint owner, the transfer on death deed is effective.
199	199	(c) If a transfer on death deed is made by two or more
200	200	transferors who are joint owners with right of survivorship, the
201	201	last surviving joint owner may revoke the transfer on death deed
202	202	subject to Section 114.057.
203	203	(d) A transfer on death deed transfers real property without
204	204	covenant of warranty of title even if the deed contains a contrary
205	205	provision.
206	206	Sec. 114.104. TRANSFER ON DEATH DEED PROPERTY SUBJECT TO
207	207	LIENS AND ENCUMBRANCES AT TRANSFEROR'S DEATH; CREDITORS' CLAIMS.
208	208	(a) Subject to Section 13.001, Property Code, a beneficiary takes
209	209	the real property subject to all conveyances, encumbrances,
210	210	assignments, contracts, mortgages, liens, and other interests to
211	211	which the real property is subject at the transferor's death. For
212	212	purposes of this subsection and Section 13.001, Property Code, the
213	213	recording of the transfer on death deed is considered to have
214	214	occurred at the transferor's death.
215	215	(b) If a personal representative has been appointed for the
216	216	transferor's estate, an administration of the estate has been
217	217	opened, and the real property transferring under a transfer on
218	218	death deed is subject to a lien or security interest, including a
219	219	deed of trust or mortgage, the personal representative shall give
220	220	notice to the creditor of the transferor as the personal
221	221	representative would any other secured creditor under Section
222	222	308.053. The creditor shall then make an election under Section
223	223	355.151 in the period prescribed by Section 355.152 to have the
224	224	claim treated as a matured secured claim or a preferred debt and
225	225	lien claim, and the claim is subject to the claims procedures
226	226	prescribed by this section.
227	227	(c) If the secured creditor elects to have the claim treated
228	228	as a preferred debt and lien claim, Sections 355.154 and 355.155
229	229	apply as if the transfer on death deed were a devise made in a will,
230	230	and the creditor may not pursue any other claims or remedies for any
231	231	deficiency against the transferor's estate.
232	232	(d) If the secured creditor elects to have the claim treated
233	233	as a matured secured claim, Section 355.153 applies as if the
234	234	transfer on death deed were a devise made in a will, and the claim is
235	235	subject to the procedural provisions of this title governing
236	236	creditor claims.
237	237	Sec. 114.105. DISCLAIMER. A designated beneficiary may
238	238	disclaim all or part of the designated beneficiary's interest as
239	239	provided by Chapter 122.
240	240	Sec. 114.106. LIABILITY FOR CREDITOR CLAIMS; ALLOWANCES IN
241	241	LIEU OF EXEMPT PROPERTY AND FAMILY ALLOWANCES. (a) To the extent
242	242	the transferor's estate is insufficient to satisfy a claim against
243	243	the estate, expenses of administration, any estate tax owed by the
244	244	estate, or an allowance in lieu of exempt property or family
245	245	allowance to a surviving spouse, minor children, or incapacitated
246	246	adult children, the personal representative may enforce that
247	247	liability against real property transferred at the transferor's
248	248	death by a transfer on death deed to the same extent the personal
249	249	representative could enforce that liability if the real property
250	250	were part of the probate estate.
251	251	(b) Notwithstanding Subsection (a), real property
252	252	transferred at the transferor's death by a transfer on death deed is
253	253	not considered property of the probate estate for any purpose,
254	254	including for purposes of Section 531.077, Government Code.
255	255	(c) If a personal representative does not commence a
256	256	proceeding to enforce a liability under Subsection (a) on or before
257	257	the 90th day after the date the representative receives a demand for
258	258	payment, a proceeding to enforce the liability may be brought by a
259	259	creditor, a distributee of the estate, a surviving spouse of the
260	260	decedent, a guardian or other appropriate person on behalf of a
261	261	minor child or adult incapacitated child of the decedent, or any
262	262	taxing authority.
263	263	(d) If more than one real property interest is transferred
264	264	by one or more transfer on death deeds or if there are other
265	265	nonprobate assets of the transferor that may be liable for the
266	266	claims, expenses, and other payments specified in Subsection (a),
267	267	the liability for those claims, expenses, and other payments may be
268	268	apportioned among those real property interests and other assets in
269	269	proportion to their net values at the transferor's death.
270	270	(e) A proceeding to enforce liability under this section
271	271	must be commenced not later than the second anniversary of the
272	272	transferor's death, except for any rights arising under Section
273	273	114.104(d).
274	274	(f) In connection with any proceeding brought under this
275	275	section, a court may award costs and reasonable and necessary
276	276	attorney's fees in amounts the court considers equitable and just.
277	277	SUBCHAPTER D. FORMS FOR TRANSFER ON DEATH DEED
278	278	Sec. 114.151. OPTIONAL FORM FOR TRANSFER ON DEATH DEED. The
279	279	following form may be used to create a transfer on death deed.
280	280	REVOCABLE TRANSFER ON DEATH DEED
281	281	NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU
282	282	MAY REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS
283	283	INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS:
284	284	YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
285	285	IMPORTANT NOTICE TO OWNER: You should carefully read all the
286	286	information included in the instructions to this form. You may want
287	287	to consult a lawyer before using this form.
288	288	MUST RECORD DEED: Before your death, this deed must be recorded with
289	289	the county clerk where the property is located, or it will not be
290	290	effective.
291	291	MARRIED PERSONS: If you are married and want your spouse to own the
292	292	property on your death, you must name your spouse as the primary
293	293	beneficiary. If your spouse does not survive you, the property will
294	294	transfer to any listed alternate beneficiary or beneficiaries on
295	295	your death.
296	296	1. Owner (Transferor) Making this Deed:
297	297	___________________________ ____________________
298	298	Printed name Mailing address
299	299	2. Legal Description of the Property:
300	300	___________________________________________________
301	301	3. Address of the Property (if any) (include county):
302	302	___________________________________________________
303	303	4. Primary Beneficiary (Transferee) or Beneficiaries
304	304	(Transferees)
305	305	I designate the following beneficiary or beneficiaries, if
306	306	the beneficiary survives me:
307	307	___________________________ ____________________
308	308	Printed name Mailing address
309	309	5. Alternate Beneficiary or Beneficiaries (Optional)
310	310	If no primary beneficiary survives me, I designate the
311	311	following alternate beneficiary or beneficiaries:
312	312	___________________________ ____________________
313	313	Printed name Mailing address
314	314	6. Transfer on Death
315	315	At my death, I grant and convey to the primary beneficiary or
316	316	beneficiaries my interest in the property, to have and hold
317	317	forever. If at my death I am not survived by any primary
318	318	beneficiary, I grant and convey to the alternate beneficiary or
319	319	beneficiaries, if designated, my interest in the property, to have
320	320	and hold forever. If the primary and alternate beneficiaries do not
321	321	survive me, this transfer on death deed shall be deemed canceled by
322	322	me.
323	323	7. Printed Name and Signature of Owner Making this Deed:
324	324	___________________________ ____________________
325	325	Printed Name Date
326	326	___________________________
327	327	Signature
328	328	BELOW LINE FOR NOTARY ONLY
329	329	Acknowledgment
330	330	STATE OF ____________________
331	331	COUNTY OF ___________________
332	332	This instrument was acknowledged before me on the ______ day of
333	333	______________, 20____,
334	334	by ___________________.
335	335	Notary Public, State of
336	336	After recording, return to:
337	337	(insert name and mailing address)
338	338	________________________________
339	339	________________________________
340	340	INSTRUCTIONS FOR TRANSFER ON DEATH DEED
341	341	DO NOT RECORD THESE INSTRUCTIONS
342	342	Instructions for Completing the Form
343	343	1. Owner (Transferor) Making this Deed: Enter your first, middle
344	344	(if any), and last name here, along with your mailing address.
345	345	2. Legal Description of the Property: Enter the formal legal
346	346	description of the property. This information is different from the
347	347	mailing and physical address for the property and is necessary to
348	348	complete the form. To find this information, look on the deed you
349	349	received when you became an owner of the property. This information
350	350	may also be available in the office of the county clerk for the
351	351	county where the property is located. Do NOT use your tax bill to
352	352	find this information. If you are not absolutely sure, consult a
353	353	lawyer.
354	354	3. Address of the Property: Enter the physical address of the
355	355	property.
356	356	4. Primary Beneficiary or Beneficiaries: Enter the first and last
357	357	name of each person you want to get the property when you die. If you
358	358	are married and want your spouse to get the property when you die,
359	359	enter your spouse's first and last name (even if you and your spouse
360	360	own the property together).
361	361	5. Alternate Beneficiary or Beneficiaries: Enter the first and
362	362	last name of each person you want to get the property if no primary
363	363	beneficiary survives you.
364	364	6. Transfer on Death: No action needed.
365	365	7. Printed Name and Signature of Owner: Do not sign your name or
366	366	enter the date until you are before a notary. Include your printed
367	367	name.
368	368	8. Acknowledgment: This deed must be signed before a notary. The
369	369	notary will fill out this section of the deed.
370	370	Sec. 114.152. OPTIONAL FORM OF REVOCATION. The following
371	371	form may be used to create an instrument of revocation under this
372	372	chapter.
373	373	CANCELLATION OF TRANSFER ON DEATH DEED
374	374	IMPORTANT NOTICE TO OWNER: You should carefully read all the
375	375	information included in the instructions to this form. You may want
376	376	to consult a lawyer before using this form.
377	377	MUST RECORD FORM: Before your death, this cancellation form must be
378	378	recorded with the county clerk where the property is located, or it
379	379	will not be effective. This cancellation is effective only as to the
380	380	interests in the property of owners who sign this cancellation
381	381	form.
382	382	1. Owner (Transferor) Making this Cancellation:
383	383	______________________ ________________________
384	384	Printed name Mailing address
385	385	2. Legal Description of the Property:
386	386	______________________________________________________
387	387	3. Address of the Property (if any) (include county):
388	388	______________________________________________________
389	389	4. Cancellation
390	390	I cancel all my previous transfers of this property by
391	391	transfer on death deed.
392	392	5. Printed Name and Signature of Owner (Transferor) Making this
393	393	Cancellation:
394	394	_________________________ ________________________
395	395	Printed Name Date
396	396	_________________________
397	397	Signature
398	398	BELOW LINE FOR NOTARY ONLY
399	399	________________________________________________________________
400	400	Acknowledgment
401	401	STATE OF __________________
402	402	COUNTY OF _________________
403	403	This instrument was acknowledged before me on the ___ day of
404	404	__________, 20______,
405	405	by ____________________________.
406	406	_______________________________
407	407	Notary Public, State of ________
408	408	After recording, return to:
409	409	(insert name and mailing address)
410	410	_________________________________
411	411	_________________________________
412	412	INSTRUCTIONS FOR CANCELING A TRANSFER ON DEATH (TOD) DEED
413	413	DO NOT RECORD THESE INSTRUCTIONS
414	414	Instructions for Completing the Form
415	415	1. Owner (Transferor) Making this Cancellation: Enter your first,
416	416	middle (if any), and last name here, along with your mailing
417	417	address.
418	418	2. Legal Description of the Property: Enter the formal legal
419	419	description of the property. This information is different from the
420	420	mailing and physical address for the property and is necessary to
421	421	complete the form. To find this information, look on the deed you
422	422	received when you became an owner of the property. This information
423	423	may also be available in the office of the county clerk for the
424	424	county where the property is located. Do NOT use your tax bill to
425	425	find this information. If you are not absolutely sure, consult a
426	426	lawyer.
427	427	3. Address of the Property: Enter the physical address of the
428	428	property.
429	429	4. Cancellation: No action needed.
430	430	5. Printed Name and Signature of Owner: Do not sign your name or
431	431	enter the date until you are before a notary. Include your printed
432	432	name.
433	433	6. Acknowledgment: This cancellation form must be signed before a
434	434	notary. The notary will fill out this section of the form.
435	435	SECTION 2. Section 22.027(b), Estates Code, is amended to
436	436	read as follows:
437	437	(b) Except as otherwise provided by this code, the [The]
438	438	definition of "person" assigned by Section 311.005, Government
439	439	Code, does not apply to any provision in this code.
440	440	SECTION 3. Section 122.001(1), Estates Code, is amended to
441	441	read as follows:
442	442	(1) "Beneficiary" includes a person who would have
443	443	been entitled, if the person had not made a disclaimer, to receive
444	444	property as a result of the death of another person:
445	445	(A) by inheritance;
446	446	(B) under a will;
447	447	(C) by an agreement between spouses for community
448	448	property with a right of survivorship;
449	449	(D) by a joint tenancy with a right of
450	450	survivorship;
451	451	(E) by a survivorship agreement, account, or
452	452	interest in which the interest of the decedent passes to a surviving
453	453	beneficiary;
454	454	(F) by an insurance, annuity, endowment,
455	455	employment, deferred compensation, or other contract or
456	456	arrangement; [or]
457	457	(G) under a pension, profit sharing, thrift,
458	458	stock bonus, life insurance, survivor income, incentive, or other
459	459	plan or program providing retirement, welfare, or fringe benefits
460	460	with respect to an employee or a self-employed individual; or
461	461	(H) by a transfer on death deed.
462	462	SECTION 4. This Act takes effect September 1, 2015.