Testamentary Residue Allocation

Testamentary Residue Allocation refers to the process by which the remaining assets of a decedent’s estate are distributed after specific bequests and debts have been settled. This allocation is typically outlined in a Last Will and Testament and is crucial for determining how the remainder of the estate is divided among beneficiaries.

In a Last Will and Testament, a testator (the person who creates the will) may specify particular items or amounts of money to be given to certain individuals, known as specific bequests. Once all debts, taxes, and these specific bequests are accounted for, the remaining assets—collectively referred to as the residue—are allocated according to the instructions laid out in the will.

For example, if a testator leaves $10,000 to a friend and specifies that their jewelry collection is to go to a relative, but the estate also includes a home, stocks, and other assets valued at $200,000, the allocation of testamentary residue would involve distributing the remaining assets after fulfilling the cash and specific jewelry bequest. If the will states that the residue should be divided equally among three children, then each would receive an equal share of the residual estate, which in this case would be valued at $190,000 after the specific bequests are deducted.

In Texas, it is important to clearly outline the testamentary residue allocation to avoid disputes among heirs and to ensure that the decedent’s wishes are respected. Texas law also allows for the use of trusts to manage residue, which can provide additional control over the distribution and management of assets posthumously.