Disclaimers of Real Estate in Texas

Disclaim Texas Property

There are situations where a person does not want to take title to real estate passed to them by will or inheritance. Some examples might include low value properties with large tax or assessment obligations, properties encumbered by substantial liens, or properties with large environmental risks. Other reasons for wanting to disclaim real estate might be centered around the person as opposed to the property. Some people might be concerned about losing government benefits if they were to inherit a property. Others might be worried about certain obligations attaching to a property such as federal tax liens, child support liens, or abstracts of judgement.

Whatever the reason for wanting to disclaim property, Texas has a codified process in the property code known as the Texas Uniform Disclaimer of Property Interests Act. Tex. Prop. Code Ann. § 240.001 (West). The general requirements for a disclaimer to be effective include that the disclaimer must be in writing, a declaration that a disclaimer is being made, a description of the property being disclaimed, and a signature by the person making the disclaimer. Tex. Prop. Code Ann. § 240.009 (West).

For property inherited by intestacy or property passed via will, the disclaimer also must be delivered to the personal representative of the estate or if no personal representative has been appointed, filed with the county clerk. Tex. Prop. Code Ann. § 240.102 (West). Under the new Texas Uniform Disclaimer of Property Interests Act (effective September 1, 2015), there is no time limit for which to make a disclaimer. However, the previous version of the law included a 9 month time limit (e.g. 9 months from the date of the decedent’s death). A plain reading of the new act leaves some ambiguity as to whether disclaimers related to events that occurred prior to the passage of the new act can now be accomplished or the time limit under the old law still applies.

"The Texas Disclaimer Act became effective September 1, 2015, and applies to disclaimers of any interest in or power over property, whenever created. Sections 17 and 18 of House Bill 2428 provide that the Texas Disclaimer Act applies if the filing and notice provisions under the former law have not elapsed.145 As the Act explains, “[i]f the time for filing or delivering notice of a written memorandum of disclaimer under former law has elapsed, the former law applies and is continued in effect for that purpose.” This means that while the effective date of the act was September 1, 2015, the operative date is December 1, 2014. If the event giving rise to the disclaimer (for example, the death of a decedent) occurred on or after December 1, 2014, the nine-month deadline under the prior law had not lapsed prior to the effective date of the new act, so the new disclaimer rules apply and there is no time limit for disclaiming. If the decedent died November 30, 2014, the nine-month deadline lapsed prior to the effective date, so the old disclaimer rules apply." Glenn M. Karisch et. al., Disclaimers Under the New Texas Uniform Disclaimer of Property Interests Act, 8 Est. Plan. & Community Prop. L.J. 179, 194–95 (2015).

Disclaimers of real estate in Texas is a complex process, and a competent real estate or probate attorney should be consulted before making a disclaimer.

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