Texas Trust Laws

Death is inevitable. Despite this sword of Damocles hanging over everyone's head, most people often fail to prepare for the day the Grim Reaper shows up. Although the reasons for pushing off estate planning are aplenty, this does not detract from the importance of figuring out what will happen to your property once you die. Texas trust laws provide people with options to manage their property during their lives so that there is an easy transition after they pass. This is a quick summary of the trust laws in Texas.

Properly Transferring Property Through Texas Trust Laws

There are a variety of trust types that people can use under Texas trust laws. Most trusts executed in the Lone Star State need to follow specific creation requirements when they are made. The following table outlines the specifics of Texas trust laws.

Code Sections

Texas Statutes - Subtitle B: Texas Trust Code: Creation, Operation, And Termination Of Trusts

Creation Requirements

Under Texas trust laws, the following are required for a valid trust to be formed:

  • The Settlor must have a present intent to create a trust.

  • The Settlor must have capacity to convey assets to the trust.

  • The trust must comply with the Statute of Frauds.

  • The trust must have a legal purpose.

  • The Settlor must identify the property covered by the trust and place it in the trust for the benefit of the beneficiary.

  • The trust must have a Trustee who holds legal title of property for the benefit of the trust's beneficiaries.

  • The trust must have ascertainable beneficiaries. If the Settlor does not name the beneficiaries with sufficient certainty, the trust will fail.

  • The trust may not violate the Rule Against Perpetuities.

Methods of Creating Trusts

A trust may be created by:

  • A property owner's declaration that the owner holds the property as trustee for another person;

  • A property owner's inter vivos transfer of the property to another person as trustee for the transferor or a third person;

  • A property owner's testamentary transfer to another person as trustee for a third person;

  • An appointment under a power of appointment to another person as trustee for the donee of the power or for a third person; or

  • A promise to another person whose rights under the promise are to be held in trust for a third person.

Trust for Care of Animals

A trust may be created to provide for the care of an animal alive during the settlor's lifetime. The trust terminates on the death of the last surviving animal named in the trust.

Knowing where your property will go after you die is an important step during your lifetime. If you need legal assistance in creating a trust, you can contact a Texas trust lawyer through FindLaw. Visit FindLaw's sections on trusts and estate planning for more articles and information on this topic.

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