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Homestead And Other Property Exemptions

One goal of estate planning is to protect assets from lawsuits and creditors. One protection you already have in Texas is the homestead exemption. It’s important to understand how this exemption works before you do anything that could result in the loss of that protection.

At Kennedy & Jackson, located in Houston, our lawyers understand how to protect real estate and other personal property under the Texas property code. Our attorneys are board-certified in estate planning and probate law by the Texas Board of Legal Specialization.

WHAT IS THE HOMESTEAD EXEMPTION?

In Texas, your creditors cannot force the sale of your home to pay your debts, with the exception of mortgage debt, cost of improvements and tax debt. Texas’s homestead exemption law is strong and has stood the test of time.

A homestead in Texas is:

  • Up to 10 acres in an urban environment with all improvements, unlimited in dollar value
  • Up to 100 acres in a rural area (200 acres for a married couple) with all improvements, unlimited in dollar value

Rental property and second homes are not protected by the homestead exemption. If you sell your homestead, you have up to six months to reinvest the proceeds in another homestead or protected form of ownership or creditors can seize it.

If you plan on leaving your homestead to your beneficiaries when you die, it’s important to transfer the asset in a way that protects it from creditors. For example, if you use a transfer on death deed (TOD), the property may not be protected. A non-homestead residence is not protected unless you do some form of asset protection.

Examples of other exempt property that is protected from creditors in Texas include:

  • Life insurance and proceeds
  • Personal property valued up to $60,000, including home furnishings, jewelry, motor vehicles, equipment, pets, two guns and farm animals up to certain limits
  • Certain retirement saving plans
  • College savings plans

CONTACT A PROPERTY EXEMPTIONS ATTORNEY IN HOUSTON

For more information about Texas property exemptions, call 713-783-7444 or send us an email. Our law office is located in the Galleria area of Houston, with free on-site parking available next to our office building. We provide a free — and confidential — initial consultation to all new potential clients.