Excess Proceeds Recovery For A Surviving Spouse and Children of Separate Property

Note: This blog post is intended for informational purposes only and should not be construed as legal advice. If you have questions about your specific situation, please consult with an experienced attorney.

Excess proceeds claims can arise when a property owner’s real estate is sold at a property tax sale in Texas for delinquent property taxes. If the sale generates more money than is needed to pay off the taxes, the excess proceeds can be claimed by the property owner or their heirs if the property owner is deceased. However, in cases where the property owner is deceased, the distribution of excess proceeds can be more complex.

Under Texas law, the surviving spouse of an intestate (died without a valid will) decedent is entitled to a 1/3rd life estate interest in the decedent’s separate property sold in a property tax sale. This means that the surviving spouse has the right to use and enjoy the property for the rest of their life but cannot sell or otherwise dispose of it. The remaining 2/3rds interest in the property is shared by the decedent’s children, who have a vested interest in the property.

When it comes to excess proceeds claims, the surviving spouse and the decedent’s children have different rights and interests. The surviving spouse is entitled to claim a portion of the excess proceeds based on their 1/3rd life estate interest in the property. The decedent’s children share the remaining 2/3rds interest in the excess proceeds.

For example, let’s say that a property owned by a decedent is sold at a property tax sale for $100,000. The property had a tax lien of $50,000, leaving $50,000 in excess proceeds. The decedent is survived by their spouse and two children. The surviving spouse would be entitled to a 1/3rd life estate interest in the property, which would entitle them to $16,667 of the excess proceeds. The remaining $33,333 in excess proceeds would be shared equally by the two children, resulting in a $16,667 payout for each child.

It’s important to note that the distribution of excess proceeds in cases involving a surviving spouse and children can be complicated. If you are dealing with an excess proceeds claim and have questions about your specific situation, it’s important to consult with an experienced attorney who can guide you through the process and help you protect your rights and interests.

Contact the Law Office of Victor D. Walker, P.C.

If you need legal assistance with excess proceeds recovery or intestate succession and distribution for community property in Texas, please don’t hesitate to contact us at 713-724-5300. Our experienced attorneys are here to help you navigate these complex legal processes and ensure that your rights are protected.

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