Historically in Texas, surviving spouses only received half of community property assets. The other half would go into probate to be divided according to state law. After numerous attempts to change the law, a 1987 legislation that amended the state constitution finally passed. The legislation modified estate law, providing spouses with more control over distribution of assets when it comes to community property.
The law provides spouses an opportunity to enter into a Community Property Survivorship Agreement. The agreement lets spouses indicate that any portion of the community property goes to a surviving spouse — including a designation of 100 percent of the property, if so chosen.
The Community Property Survivorship Agreement doesn’t cover all property. For example, if a wife inherits a home from her sister, the property belongs to her as an individual. In order to leave the home to her husband in the event of death, she would have to make it community property or transfer it to him in a trust or will.
Estate planning documents should also be used if a spouse doesn’t want 100 percent of assets to go to a surviving spouse. For example, if a couple has a bank account considered community property, half of the assets in that account belong to the husband and half to the wife. The husband may want his half split between all heirs — including his wife and children — if he dies. In this case, a trust or will can ensure his wishes are carried out despite the community property arrangements.
In Texas, as in any state, estate planning can be a complex affair. You don’t have to be wealthy to have an interest in protecting the future of those you love. Planning ahead can reduce stress and duress for your family.
Source: My San Antonio, “When to Avoid using Community Property Survivorship” Paul Premack, Jun. 04, 2014
