Heirs who sign the deed themselves are paid by the title company at funding. If an executor sells, the money goes into the estate first and is distributed after debts, expenses and taxes are handled. Texas sets no payout date, but heirs can demand an accounting after 15 months and seek a distribution after two years.
The sale is done, the buyer has the keys, and now every heir is asking the same thing: when does my share arrive? In Texas the answer turns mostly on one detail on the deed. Did the heirs sign as the sellers, or did an executor or administrator sign for the estate? The first can mean money within days of funding. The second means the money goes into the estate and waits for the estate's bills to be settled.
This guide explains the statewide rules. For what that looks like in the probate courts and clerk offices of Tarrant, Dallas, Collin and Denton counties, read our DFW guide to when heirs get paid.
First, the sale has to fund
Nobody is paid at the signing table alone. The Texas Department of Insurance's Procedural Rule P-27 requires a title company to have good funds equal to all disbursements received and deposited before it pays anyone, and it bars partial disbursements before then. For a wire, funds count as received when the bank tells the title company they arrived. Once the deal funds, the title company pays off liens, closing costs and commissions, then sends the sellers' net proceeds. Our guide on when a seller gets paid after closing covers funding in more detail.
Path one: the heirs sign the deed themselves
When the house passed to the heirs without an open administration, for example through a probated will as a muniment of title or a recorded heirship record, the heirs are the sellers. Each signs the deed, and the closing statement divides the net by ownership share. Each heir is paid at funding, by the method arranged with the title company.
A few things can still hold up a share:
- an heir who cannot be found or will not sign, which can stop the sale altogether,
- a claim against one heir's interest that turns up in the title search,
- a dispute over the shares themselves, which has to be settled before money moves.
Path two: an executor or administrator sells
When a personal representative sells, the buyer pays the estate, not the heirs. The net proceeds go into the estate's account, and the heirs are paid later through a distribution. Before that happens, the representative has to deal with what the estate owes.
What gets paid before heirs: Estates Code Sec. 355.102 ranks claims by class. Class 1 is funeral expenses and last-illness expenses, each up to $15,000 as approved by the court. Class 2 includes expenses of administration and of preserving and managing the estate. Lower classes follow in order.
Several deadlines and costs affect how long the money sits:
- Secured creditors. Sec. 355.152 gives a secured creditor a window, generally six months after letters are granted, to say how it wants its claim treated.
- Court-ordered payments. In a supervised estate, Sec. 355.106 lets the court order a representative to pay an allowed claim after the sixth month after letters are granted.
- Estate income tax. IRS Publication 559 says every domestic estate with gross income of $600 or more in a tax year must file Form 1041. Executors often hold back money until the tax picture is clear.
- The executor's commission. Under Sec. 352.002, an executor or administrator the court finds managed the estate properly is entitled to a 5 percent commission on cash actually received or paid out. It is capped at 5 percent of the estate's gross fair market value and is not allowed on cash paid to heirs as heirs. Sale proceeds received in cash can count toward it.
Independent administration: no fixed payout date
Many Texas estates use an independent administration, and the Estates Code does not set a date by which an independent executor must hand out sale proceeds. Once debts are paid as far as assets allow, no litigation is pending and the remaining assets are distributed, the executor may file a closing report or a notice of closing (Sec. 405.004). The executor is not required to close the estate formally at all (Sec. 405.012).
Heirs who are waiting have three tools:
- Accounting at 15 months. After 15 months from the date the clerk first issued letters, any interested person may demand a sworn accounting (Sec. 404.001).
- Accounting and distribution at two years. After two years from the first letters, an interested person may petition the court for an accounting and distribution. After notice and a hearing, unless the court finds a continued need for administration, it orders the executor to distribute (Sec. 405.001).
- No release as the price of payment. An independent executor may not require a waiver or release from a beneficiary as a condition of delivering property, though the executor can require a signed receipt (Sec. 405.002).
If you believe money is being misused, other remedies apply, including removal of the executor. Our guide on how long an executor has to sell a house covers the pressure points on an estate that has stalled.
Dependent administration: the court controls distribution
In a court-supervised estate, heirs are paid on the court's timeline. Under Sec. 360.001, after the first anniversary of the date original letters were granted, the representative, an heir or a devisee may file a written application asking the court to partition and distribute the estate. Each step, from paying claims to the final account, runs through the court, so expect more filings and hearings than in an independent administration.
A quick comparison
| Who sold the house | Where the money goes | When heirs are usually paid |
|---|---|---|
| All heirs, as owners | Directly to each heir | At funding, by share |
| Independent executor | Estate account | When the executor distributes; tools at 15 months and 2 years |
| Administrator in a supervised estate | Estate account | After court-approved steps; distribution application after one year |
Taxes on your share
IRS Publication 559 says property received as an inheritance is not included in your income, though income that property later produces is taxable. A sale can also create a gain or loss, generally measured from the home's value on the date of death. Our guide on taxes on inherited property explains basis and reporting, and a CPA can apply it to you.
Speeding things up
Some delay is built in, because ranked claims come before heirs and secured creditors have months to make their choices known. Still, heirs can shorten the wait by keeping contact information current with the executor, answering requests for signatures promptly, and asking early for a written estimate of debts, expenses and a likely distribution date. When the family agrees, selling as owners rather than through an administration, where the estate's situation allows it, can mean being paid at funding.
Selling an inherited house to Cash Home Advisors
Cash Home Advisors is based in Fort Worth. We can close in 7–14 days and we pay all closing costs. Whoever signs as seller sees the full closing statement, with every payoff and deduction, before signing.
See our page on selling an inherited house in Texas, read how our process works, or request a cash offer. More guides are in our inherited property category.
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Frequently asked questions
How soon after closing does the title company pay the sellers?
Under the Texas Department of Insurance's Procedural Rule P-27, a title company may not disburse until good funds equal to all disbursements are received and deposited, and partial disbursements before that are not allowed. Once the sale funds, the sellers on the deed are paid by the method set up with the title company.
Can an executor hold the sale money as long as they want?
Texas sets no fixed date for distribution, but heirs are not without tools. Any interested person may demand a sworn accounting after 15 months from the first letters, and after two years may petition the court for an accounting and distribution in an independent administration.
Does the executor get a cut of the house sale?
An executor or administrator the court finds managed the estate properly is entitled to a 5 percent commission on cash actually received or paid out, capped at 5 percent of the estate's gross fair market value. The commission is not allowed on cash paid to heirs as heirs.
Do I have to sign a release to get my share from an independent executor?
No. The Estates Code says an independent executor may not require a waiver or release from a distributee as a condition of delivering property. The executor can require a signed receipt or other proof of delivery.
Sources
- Texas Department of Insurance, Basic Manual of Title Insurance, Procedural Rule P-27
- Texas Estates Code, Chapter 355 (Secs. 355.102, 355.106 and 355.152)
- Texas Estates Code, Chapter 352 (Sec. 352.002 executor commission)
- Texas Estates Code, Chapter 404 (Sec. 404.001 accounting)
- Texas Estates Code, Chapter 405 (Secs. 405.001, 405.002 and 405.004)
- Texas Estates Code, Chapter 360 (Sec. 360.001 partition and distribution)
- IRS Publication 559, Survivors, Executors, and Administrators
- IRS Publication 551, Basis of Assets (inherited property)
General information, not legal or tax advice. Talk to a Texas attorney or CPA about your situation.