By Thompson H.B. No. 2401
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to matters concerning the Texas Probate Code.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 58. Interests Which May Pass Under a Will, is
1-5 amended to read as follows:
1-6 (a) Every person competent to make a last will and testament
1-7 may thereby devise and bequeath all the estate, right, title, and
1-8 interest in property the person has at the time of the person's
1-9 death, subject to the limitations prescribed by law.
1-10 (b) A person who makes a last will and testament may:
1-11 (1) disinherit an heir; and
1-12 (2) direct the disposition of property or an interest
1-13 passing under the will or by intestacy.
1-14 (c) A legacy of personal property does not include any
1-15 contents of the property unless the will directs that the contents
1-16 are included in the legacy. A devise of real property does not
1-17 include any personal property located on or associated with the
1-18 real property or any contents of personal property located on the
1-19 real property unless the will directs that the personal property or
1-20 contents are included in the devise.
1-21 (d) In this section:
1-22 (1) "Contents" means tangible personal property, other
1-23 than titled personal property, found inside of or on a specifically
2-1 <bequested> bequeathed or devised item. The term includes
2-2 clothing, pictures, furniture, coin collections, and other items of
2-3 tangible personal property that do not require a formal transfer of
2-4 title <or> and that are located in another item of tangible personal
2-5 property such as a cedar chest or other furniture <located on real
2-6 property>.
2-7 (2) "Titled personal property" includes all tangible
2-8 personal property represented by a certificate of title,
2-9 certificate of ownership, written label, marking, or designation
2-10 that signifies ownership by a person. The term includes a <stock
2-11 certificate,> motor vehicle, motor home, motorboat, or other
2-12 similar property that requires a formal transfer of title.
2-13 SECTION 69. Voidness Arising From Divorce or Annulment is
2-14 amended to read as follows:
2-15 (a) If, after making a will, the testator is divorced <after
2-16 making a will> or the testator's marriage is annuled, all
2-17 provisions in the will in favor of the testator's former spouse <so
2-18 divorced>, or appointing such spouse to any fiduciary capacity
2-19 under the will or with respect to the estate or person of the
2-20 testator's children, shall be null and void and of no effect unless
2-21 the will expressly provides otherwise.
2-22 (b) A person who is divorced from the decedent or whose
2-23 marriage to the decedent has been annulled is not a surviving
2-24 spouse unless, by virtue of a subsequent marriage, the person is
2-25 married to the decedent at the time of death.
3-1 SECTION 113.111. Charges Against Income and Principal is
3-2 amended to read as follows:
3-3 (a) The following charges shall be made against income:
3-4 (1) ordinary expenses incurred in the administration,
3-5 management, or preservation of the trust property, including
3-6 regularly recurring taxes assessed against any portion of the
3-7 principal, water rates, premiums on insurance on the interests of
3-8 an income beneficiary, remainderman, or trustee, interest paid by
3-9 the trustee, and ordinary repairs;
3-10 (2) a reasonable allowance for depreciation on
3-11 improvements representing an addition of value to property held by
3-12 the trustee as part of the principal if the improvements are
3-13 subject to depreciation under generally accepted accounting
3-14 principles, but no allowance may be made for depreciation of the
3-15 portion of any real property used by a beneficiary as a residence
3-16 or for depreciation of any property held by the trustee on the
3-17 effective date of this subtitle for which the trustee <is> was not
3-18 then making an allowance for depreciation;
3-19 (3) court costs and other fees on periodic judicial
3-20 accountings, unless the court directs otherwise;
3-21 (4) court costs, attorney's fees, and other fees on
3-22 other accounting or judicial proceedings if the matter primarily
3-23 concerns the income interest, unless the court directs otherwise;
3-24 (5) all expenses reasonably incurred by the trustee
3-25 for current management of principal and application of income;
4-1 (6) the portion of attorney's fees and the trustee's
4-2 compensation for services in the management and administration of
4-3 the trust estate, irrespective of the manner of computation, and
4-4 for extraordinary and unusual services, including remuneration of
4-5 the trustee for acceptance of the trust, distribution of the trust
4-6 properties, termination of the trust estate, and all other fees of
4-7 similar nature, as the trustee determines in its discretion to be
4-8 just and equitable;
4-9 (7) a tax levied on proceeds defined as income under
4-10 this subchapter or the trust instrument that is payable by the
4-11 trustee; and
4-12 (8) regularly recurring charges payable from income to
4-13 the same extent and in the same manner that income is apportioned
4-14 under Section 113.103 of this Act.
4-15 (b) The following charges shall be made against principal:
4-16 (1) the portion of the attorney's fees and the
4-17 trustee's compensation not charged to income under Subdivision (6)
4-18 of Subsection (a) of this section;
4-19 (2) expenses reasonably incurred in connection with
4-20 principal and court costs primarily concerning matters of
4-21 principal;
4-22 (3) charges not provided for in Subsection (a) of this
4-23 section, including the cost of investing and reinvesting principal,
4-24 the payments on principal of an indebtedness, including a mortgage
4-25 amortized by periodic payments of principal, expenses for
5-1 preparation of property for rental or sale, and, unless the court
5-2 directs otherwise, expenses incurred in maintaining or defending
5-3 any action to construe the trust, to protect the trust or the trust
5-4 property, or to assure the title of trust property;
5-5 (4) extraordinary repairs or expenses incurred in
5-6 making a capital improvement to principal, including special
5-7 assessments, but a trustee may establish an allowance for
5-8 depreciation out of income to the extent permitted by Subdivision
5-9 (2) of Subsection (a) of this section and by Section 113.106 of
5-10 this Act;
5-11 (5) a tax levied on profit, gain, or other proceeds
5-12 allocated to principal, notwithstanding characterization of the tax
5-13 as an income tax by the taxing authority; and
5-14 (6) if an estate tax, transfer tax, or inheritance tax
5-15 is levied in respect to a trust in which both an income beneficiary
5-16 and a remainderman have an interest, any amount apportioned to the
5-17 trust, including interest and penalties, even though the income
5-18 beneficiary also has rights in the principal<; and>
5-19 <(7) regularly recurring charges payable from income
5-20 to the same extent and in the same manner that income is
5-21 apportioned under Section 113.103 of this Act>.
5-22 (c) If charges against income are unusual in amount, the
5-23 trustee may by use of reserves or other reasonable means apportion
5-24 the charges over a reasonable period of time and withhold from
5-25 distribution sufficient amounts to regularize distributions.
6-1 SECTION 137. Collection of Small Estates Upon Affidavit is
6-2 amended to read as follows:
6-3 (a) The distributees of an estate shall be entitled thereto,
6-4 to the extent that the assets, exclusive of homestead and exempt
6-5 property, exceed the known liabilities of said estate, exclusive of
6-6 liabilities secured by homestead and exempt property, without
6-7 awaiting the appointment of a personal representative when:
6-8 (1) No petition for the appointment of a personal
6-9 representative is pending or has been granted; and
6-10 (2) Thirty days have elapsed since the death of the
6-11 decedent; and
6-12 (3) The value of the entire assets of the estate, not
6-13 including homestead and exempt property, does not exceed $50,000;
6-14 and
6-15 (4) There is filed with the clerk of the court having
6-16 jurisdiction and venue an affidavit sworn to by two disinterested
6-17 witnesses <and>, by such distributees as have legal capacity<,> and,
6-18 if the facts warrant, by the natural guardian or next of kin of any
6-19 minor or incompetent who is also a distributee, which affidavit
6-20 shall be examined by the judge of the court having jurisdiction and
6-21 venue; <the judge may find, in his discretion, that the affidavit
6-22 conforms to the terms of this section, if the judge approves the
6-23 affidavit, the affidavit is to be recorded as an official public
6-24 record under Chapter 194, Local Government Code, or if the county
6-25 has not adopted a microfilm or microphotographic process under
7-1 Chapter 194, Local Government Code, the affidavit must be recorded
7-2 in "Small Estates" records by the clerk, showing> and
7-3 (5) The affidavit shows the existence of the foregoing
7-4 conditions<, including> and includes a list of all known assets and
7-5 liabilities of the estate<,> the names and addresses of the
7-6 distributees, and <their right> the distributees' rights to receive
7-7 the money or property of the estate<,> or to have such evidences of
7-8 money, property or other rights of the estate as are found to exist
7-9 transferred to them<, being> as heirs, devisees<,> or assignees<,>:
7-10 and <listing all assets and known liabilities of the estates>
7-11 (6) The judge, in his discretion, finds that the
7-12 affidavit conforms to the terms of this section and approves the
7-13 affidavit; and
7-14 <(5)> (7) A copy of <such> the affidavit, certified to
7-15 by said clerk, is furnished by the distributees of the estate to
7-16 the person or persons owing money to the estate, having custody or
7-17 possession of property of the estate, or acting as registrar,
7-18 fiduciary or transfer agent of or for evidences of interest,
7-19 indebtedness, property or other right belonging to <said> the
7-20 estate.
7-21 (b) This section does not affect the disposition of property
7-22 under the terms of a will or other testamentary document nor,
7-23 except as provided by Subsection (c) of this section, does it
7-24 transfer title to real property.
7-25 (c) Title to homestead that is the only real property in a
8-1 decedent's estate may be transferred on an affidavit that meets the
8-2 requirements of this section. An affidavit that is used to
8-3 transfer title to a homestead under this section. An affidavit
8-4 that is used to transfer title to a homestead under this section
8-5 must be recorded in the deed records of <a> the county in which the
8-6 homestead is located. A bona fide purchaser for value may rely on
8-7 a recorded affidavit under this section. A bona fide purchaser for
8-8 value without actual or constructive notice of an heir who is not
8-9 disclosed in a recorded affidavit under this section acquires title
8-10 to a homestead free of the interests of the undisclosed heir, but
8-11 the bona fide purchaser remains subject to <a> any claim a creditor
8-12 of the decedent has <as provided> by law. A <person> purchaser has
8-13 constructive notice of <the rights of> an heir who is not disclosed
8-14 in a recorded affidavit under this section if an affidavit,
8-15 judgment of heirship, or title transaction in the chain of title in
8-16 the deed records <states that> identifies the heir of the decedent
8-17 who is not disclosed in the affidavit <is> as an heir of the
8-18 decedent. An heir who is not disclosed in a recorded affidavit
8-19 under this section may recover from an heir who receives
8-20 consideration from a purchaser in a transfer <to a bona fide
8-21 purchaser> for value of title to a homestead passing under the
8-22 affidavit.
8-23 (d) <The county clerk of every county that> If the judge
8-24 approves the affidavit under this section, the affidavit is to be
8-25 recorded as an official public record under Chapter 194, Local
9-1 Government Code. If the county has not adopted a microfilm or
9-2 microphotographic process under Chapter 194, Local Government Code,
9-3 the county clerk shall provide and keep in his office an
9-4 appropriate book labeled "Small Estates," with an accurate index
9-5 showing the name of the decedent and reference to land, if any,
9-6 involved, in which he shall record every such affidavit so filed,
9-7 upon being paid his legal recording fee<, said index to show the
9-8 name of decedent and reference to land, if any involved>.