The 2011 regular session of the Texas Legislature ended May 30, 2011. Governor Perry has until June 19, 2011, to sign or veto bills. While the legislature is meeting in special session as of this writing (June 8, 2011), it is unlikely that any probate, guardianship or trust legislation will be enacted in this or any other special session. Most enacted legislation becomes effective September 1, 2011.
There are summaries of each enacted bill in the 2011 Legislation portion of The Texas Probate Website. Bill Pargaman's excellent and comprehensive legislative update is available online here. texasprobate.com. Here are some of the key changes:
You won't have to file an inventory in most independent administrations.
SB 1198 amends Section 250 of the Probate Code to permit an independent executor to file an affidavit in lieu of an inventory if there are no unpaid debts, except for secured debts, taxes and administrative expenses, at the time the inventory is due. The independent executor still must prepare an inventory and send a copy to each beneficiary, but the public disclosure of the decedent's assets which results from filing a probate inventory will no longer be required in the vast majority of estates.
The testator and witnesses need to sign the will only once.
SB 1198 amends Section 59 to allow a combined execution of the will and self-proving affidavit so that the testator and witnesses are required to sign only once, instead of having to sign both the will and the self-proving affadavit. The old way still works, but this provides a new way to speed up will signings.
Survivorship accounts -- the worst part of Holmes v. Beatty is overruled.
SB 1198 amends Sections 439 and 452 to make it clear that, for both community property and non-community property multiple party accounts, a survivorship agreement will not be inferred from the mere fact that the account is a joint account or that the account is designated as JT TEN, Joint Tenancy, or joint, or with similar language. The effective date provision makes it clear that this was intended to expressly overrule Holmes v. Beatty, 290 S.W.3d 852 (Tex. 2009).
Changes to Section 128A notices to beneficiaries.
SB 1198 amends Section 128A to make it easier on personal representatives. No notice is required if the beneficiary receives property worth $2,000 or less or if the beneficiary receives all property to which he or she is entitled within 60 days of the order admitting the will to probate. The notice need not include a copy of the will and the order admitting it to probate if the notice includes a summary of the gifts to the beneficiary, the court in which the will is probated and the docket number assigned to the case. The bill clarifies other issues about 128A notices.
Power of sale in independent administrations.
SB 1198 attempts to clarify whether or not an independent administrator has the power to sell real property. In cases where there is no will or the will does not give the independent administrator or executor the power of sale, Section 145A permits the distributees of the estate to agree at the time the personal representative is appointed to consent to granting the power of sale, in which case the court will include the power of sale in the order appointing the independent administrator or executor. Section 145C attempts to clarify in which cases independent executors have the power of sale.
Deadline to make disclaimers extended to match 2010 tax law.
SB 1197 and SB 1198 change the disclaimer provisions in the Trust Code and Probate Code, respectively, to extend the deadling for persons dying after December 31, 2009, but before December 17, 2010, until 9 months after December 17, 2010. The tax law enacted by Congress in December 2010 gave those decedents until that date to disclaim for federal tax law purposes, so the Texas law change matches the federal change.
Creditor protection for inherited IRAs.
SB 1810 amends Section 42.0021 of the Property Code to provide that all IRAs, including inherited IRAs, are exempt from creditors' claims. It provides that the interest of a person in an IRA acquired by reason of the death of another person is exempt to the same extent that the interest of the person from whom the account was acquired was exempt on the date of the person's death. The exempt status of inherited IRAs was called into question by In re Jarboe, 2007 WL 987314 (Bankr. S. D. Tex 2007), and similar cases across the country.