Why in the world would you want to disclaim your inheritance in Texas? Actually, there are many reasons. There may be tax reasons. The property my be more trouble than it is worth. You want to disclaim so your heirs will inherit the property. Whatever your reasons for disclaiming your inheritance in Texas, once filed, a disclaimer is irrevocable and applies to all future interest in the property.
What happens to the property that you disclaim? When you disclaim property that is yours under a will or through inheritance the property passes as if you had predeceased the decedent. EC 122.101. A properly executed and timely filed disclaimer means that you never owned the property. It goes straight from the decedent to the ones who would get if if you had predeceased the decedent. You cannot designate a person to received the property you disclaimed. 740 2d 92.
What happens if your disclaimer is ineffective such as when it is filed too late or if the procedure for disclaiming is not followed? In those case, the ineffective disclaimer acts as an assignment of the property to those who would inherit the property if you had predeceased the decedent. The difference here is that the property is treated as if it went to you and then to the ones who would get it if you had predeceased the decedent. If you have judgments against you, the property would be reachable by those creditors. There may be tax consequences also since the property went first to you then to the others.
A disclaimer may not be effective against you if you did not have adequate knowledge of that which is being disclaimed. As an example, a brother died in Alabama. He gave his Texas land to his surviving brother and everything else to his wife in Alabama. The surviving brother knew that the Texas property had been sold so in a settlement he filed a disclaimer in Alabama as to the Texas land. Forty years later, the surviving brother discovered that his deceased brother had a non-participating royalty interest in the Texas property. The Texas courts ruled that the disclaimer was not valid because the brother was mistaken as to the property being disclaimed. 255 2d 716.
2015 Update and Changes
The legislature enacted the Texas Uniform Disclaimer of Property Interest Act, Property Code §240, Effective on September 1, 2015. Some of the changes made were: there is now just one statute on disclaimers; there is no state time limit for disclaimers; there are less restrictive technical requirements; different types of property are specifically addressed; and, fiduciary disclaimers are expanded.
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By Robert Ray a Board Certified attorney. The foregoing information is general in nature and does not apply to every fact situation. We handle litigation involving inheritance disputes. We don’t prepare wills. We don’t file wills for probate or distribute estates except when we are contesting a will or protecting a will from a contest. We handle a select few cases on contingency. Don’t use a comment to ask a personal question about an inheritance issue because your name and comment will be public. To ask a litigation question and to protect your privacy, click the red button to the right.