Texas Property Code 41.0021 – Homestead in Qualifying Trust
(a) In this section, “qualifying trust” means an express trust:
(1) in which the instrument or court order creating the express trust, an instrument transferring property to the trust, or any other agreement that is binding on the trustee provides that a settlor or beneficiary of the trust has the right to:
(A) revoke the trust without the consent of another person other than a spouse who is also a settlor of the trust;
(B) exercise an inter vivos general power of appointment over the property that qualifies for the homestead exemption, either alone or when aggregated with property subject to an inter vivos general power of appointment held by a spouse who is also a settlor of the trust; or
(C) use and occupy the residential property as the settlor’s or beneficiary’s principal residence at no cost, or rent free and without charge, except for taxes and other costs and expenses specified in the instrument or court order:
(i) for the life of the settlor or beneficiary;
(ii) for the shorter of the life of the settlor or beneficiary or a term of years specified in the instrument or court order; or
(iii) until the date the trust is revoked or terminated by an instrument or court order that describes the property with sufficient certainty to identify the property and that is recorded in the real property records of the county in which the property is located; and
(2) the trustee of which acquires the property in an instrument of title or under a court order that:
(A) describes the property with sufficient certainty to identify the property and the interest acquired; and
(B) is recorded in the real property records of the county in which the property is located.
(b) Property that a settlor or beneficiary occupies and uses in a manner described by this subchapter and in which the settlor or beneficiary owns a beneficial interest through a qualifying trust is considered the homestead of the settlor or beneficiary under § 50, Article XVI, Texas Constitution, and Section 41.001.
Terms Used In Texas Property Code 41.0021
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Inter vivos: Transfer of property from one living person to another living person.
- Person: includes corporation, organization, government or governmental subdivision or agency, business trust, estate, trust, partnership, association, and any other legal entity. See Texas Government Code 311.005
- Property: means real and personal property. See Texas Government Code 311.005
- Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
- Trustee: A person or institution holding and administering property in trust.
(c) A married person who transfers property to the trustee of a qualifying trust must comply with the requirements relating to the joinder of the person’s spouse as provided by Chapter 5, Family Code.
(d) A trustee may sell, convey, or encumber property transferred as described by Subsection (c) without the joinder of either spouse unless expressly prohibited by the instrument or court order creating the trust.
(e) This section does not affect the rights of a surviving spouse or surviving children under § 52, Article XVI, Texas Constitution, or Chapter 353, Estates Code.