In Texas, when a child is legally or formally adopted, they inherit to the same extent as natural children. A formal adoption is where the court system is involved. A suit for adoption is filed. Then, in some cases, the state investigates the adopting parents to make sure that they are good candidates for adoption. The home may also be inspected to make sure that the adopted child will be provided for. If everything is in good order, the judge approves the adoption and the adopted person becomes the child of the adopting parents with the same rights as a natural born child. That means that the adopted child inherits not only from the adopting parents but through them. They will inherit from grandparents and aunts and uncles to the same degree that a natural born child would inherit from them.
Adults who are adopted are treated differently. Those who are adopted as adults may not inherit from or through the adult's biological parent. A biological parent may not inherit from or through an adopted adult. Professor Gerry Beyer, www.ProfessorBeyer.Com, has said that this rule may lead to an absurd result. "For example, assume that Mother and Father have a child in 1985. Mother dies in 1990 and Father marries Step-Mother in 1995. As time passes, Child and Step-Mother become close and shortly after Child reaches age 18, Step-Mother adopts Child. If Father dies intestate, Child will not be considered an heir because the statute provides that an adopted adult may not inherit from a biological parent.
The statute was enacted as part of "family values" legislation primarily to prevent same-sex couples from adopting each other and thereby creating a "grandchild" for their parents. Now that same-sex couples may marry, the need for this provision may no longer exist.
The simple, albeit "dumb," solution may be to have the biological father adopt his son in the same proceeding."
Update: In 2017, the Amarillo Court of Appeals ruled that a trust that gave property to children "born of or adopted" included adults who were adopted as adults. 07-16-00003-CV. The court found no language in the trust that would restrict "adopted" to those adopted as children. "We cannot agree that any language of the trust agreements indicates an intention of the trustors to limit adopted grandchild beneficiaries to those adopted as minors." This case is applying language in the trust agreement and not applying the above statute to the question of adopted adults.
Texas also recognizes informal adoptions. An informal adoption is similar to a common law marriage in that no formal legal proceedings are involved. These adoptions may be called adoption by estoppel, equitable adoption or adoption status by the courts discussing them. The courts treat these as contract cases in that once the facts are established, the heirs of the adopting parent are estopped from denying the adopted child his inheritance rights. The courts look for an enforceable agreement between the adopting parent and the adopted child, his parents or some other person in loco parentis with the child. The adopting parent agrees to adopt the adopted child then confers affection and benefits upon them and the person who agreed with the adopting parent relies upon the adopted status. These informal adoptions are important where the adopting parent dies without a will. If the adopting parent leaves a will, he can leave his property to anyone he chooses. He can leave property to the adopted child or not. However, if he dies intestate (without a will) then the child adopted by estoppel will inherit a share of this adoptive parent's estate the same as any other child. 906 - 576.
2017 UPDATE on adoption by estoppel
In 2017, the legislature amended the Texas Estates Code to treat children adopted by estoppel the same as any other adopted child. 22.004; 201.054(e). Some of the cases and situations listed below may no longer be good law but they are included for historical research.
The informally adopted child will not inherit from his grandparents (his adoptive parent's parents) unless they were in privity with the adoption. He will only inherit from his adoptive parents not through them. In other words, persons not in privity with the adoption are not bound by the adoption.
In a 2016 case, a Texas court of appeals held that adoption by estoppel does not apply to adults but only to children. The court said "(a)llowing an adult to be adopted by estoppel "would greatly extend the doctrine and surely open the door to many fraudulent claims" ... Such an extension would open the door to abuse by "persons who have assisted and befriended the elderly during the last years of their life" and, after the decedent's death, claim the decedent "adopted" them by estoppel." 01-15-00670-CV.
In a 2017 case, the Amarillo Court of Appeals had a case involving adoption by estoppel. Although the facts are not clear the end results were that the competing parties ended up agreeing that the child claiming adoption by estoppel was the sole heir of the decedent. 07-16-00375-CV.
A Tennessee court has held that adoption by estoppel or equitable adoption are probate concepts to determine inheritance and do not apply to proceedings for parentage, custody, and visitation. Scarlett. The same is probably true in Texas courts.
Adopted children can contest the will of their parents. A formally adopted child and an informally adopted child whose adoptive grandparents were in privity with the adoption, can contest the will of their adoptive grandparents. Contesting a will is discussed here.
Example: There is an adoption by estoppel where Joe adopts Jane. Joe dies without a will. Jane inherits all or part of Joe's estate the same as any child would.
Example: There is an adoption by estoppel where Joe adopts Jane. Joe dies with a will that leaves his estate to his parents who survive him. Jane doesn't inherit from Joe because of the will. Later, Joe's parents die without a will. Jane isn't entitled to inherit from Joe's parents if they were not in privity with the adoption.
The U.S. Department of Health and Human Services Administration for Children and Families Administration on Children, Youth and Families Children's Bureau put out a summary of the various states laws relating to the adoption rights of those adopted, those adopting and the birth parents that may be found here.