Declaration of Trust — Texas Non-UTC

How a Declaration of Trust works in Texas

A declaration of trust is the written instrument that creates a trust. The grantor states an intent to hold property for named beneficiaries and appoints a trustee to manage it. Texas has not adopted the Uniform Trust Code; the state's trust rules sit in the Texas Trust Code, Property Code Title 9, alongside reenacted common law under Property Code § 111.005. The trust becomes active when it is funded: real property moves by a new deed to the trustee, and bank and brokerage accounts are retitled in the name of the trust or trustee. A successor trustee named in the document takes over if the acting trustee steps down, becomes incapacitated, or dies. When proof of the trust is needed, Property Code § 114.086 governs the certification of trust, which summarizes the instrument for third parties, and a third party may require the trustee to furnish excerpts.

Frequently asked questions

Does a Texas declaration of trust have to be notarized or witnessed?

No statute requires witnesses for a Texas trust instrument, and the certification of trust carries no explicit notarization requirement either. In practice the document is typically notarized, because a third party may require a notarized acknowledgment before relying on it. That request is a matter of counterparty practice rather than a statutory mandate, which is why two transactions involving the same document can look different. The signature requirement itself is the part the statute addresses directly.

What goes in a certification of trust under Tex. Prop. Code § 114.086?

The statute lists the contents: the date the trust instrument was executed, the identity of the grantor or settlor, the name and address of the trustee, the trustee's powers as the statute requires, whether the trust is revocable and who holds the power to revoke, the authority of cotrustees and the manner in which title is taken, and a statement that the trust has not been amended or revoked in a way that invalidates the certification. A third party may require the trustee to furnish excerpts.

How does Texas treat business trusts?

Business trusts sit outside the Texas Trust Code. Property Code § 111.003(3) excludes them from the definition of an express trust, so their formation and operation follow common law or other statutes rather than the trust chapters of the Property Code. That separation matters: the rules that apply to a family trust created by a declaration of trust are not the same rules that govern a business trust operated for commercial purposes. Each track has its own body of law.

Who may see the trust's terms, and who can rely on a certification?

Beneficiaries are entitled to see the trust's provisions; the certification is the shorter document prepared for third parties. A third party who takes the certification in good faith may rely on it without liability when there is no actual knowledge of an error in its statements. Where deeper review is involved, a third party may require the trustee to furnish excerpts covering the points the statute lists.

Common mistakes

Common issues include treating a business trust as an express trust under the Texas Trust Code; Property Code § 111.003(3) places business trusts outside that code, leaving them to common law or other statutes. Another is leaving the trust unfunded, so no property actually moves into it through a new deed or retitled accounts. Documents are also used after changes without being updated: a certification of trust states that the trust has not been amended or revoked in a way that invalidates it, so a stale certification no longer matches the instrument. Assuming Texas follows the Uniform Trust Code leads to wrong conclusions, since the state uses its own Property Code trust chapters alongside reenacted common law under § 111.005. Omitting a successor trustee or leaving cotrustee signing authority unstated creates avoidable friction during administration.

Texas notes

Texas has not adopted the Uniform Trust Code and instead operates under the Texas Trust Code, found in Property Code Title 9. The state pairs its statutes with reenacted common law under Property Code § 111.005, so common-law trust principles continue to apply alongside the statutory text. Certification of trust contents are set by Property Code § 114.086, and a third party may require the trustee to furnish excerpts from the trust instrument. Texas levies no state income tax. It is a community property state, a classification that carries estate planning advantages for married couples. Spendthrift trusts are recognized under common law. Homestead protections in Texas are strong, and they interact with how a home is titled. Business trusts follow a separate track: Property Code § 111.003(3) excludes them from the Trust Code, leaving their formation and operation to common law or other statutes.