diff --git a/go.mod b/go.mod
index 57922a3b..08ef9b23 100644
--- a/go.mod
+++ b/go.mod
@@ -8,7 +8,7 @@ require (
 	github.com/btcsuite/btcd v0.0.0-20190614013741-962a206e94e9
 	github.com/btcsuite/btclog v0.0.0-20170628155309-84c8d2346e9f
 	github.com/btcsuite/btcutil v0.0.0-20190425235716-9e5f4b9a998d
-	github.com/btcsuite/btcwallet v0.0.0-20190614043544-a335c566148c
+	github.com/btcsuite/btcwallet v0.0.0-20190619005538-de02d6fdfb23
 	github.com/btcsuite/fastsha256 v0.0.0-20160815193821-637e65642941
 	github.com/coreos/bbolt v1.3.2
 	github.com/davecgh/go-spew v1.1.1
diff --git a/go.sum b/go.sum
index e4b7dce7..c3eae414 100644
--- a/go.sum
+++ b/go.sum
@@ -39,8 +39,8 @@ github.com/btcsuite/btcutil v0.0.0-20190425235716-9e5f4b9a998d/go.mod h1:+5NJ2+q
 github.com/btcsuite/btcwallet v0.0.0-20180904010540-284e2e0e696e33d5be388f7f3d9a26db703e0c06/go.mod h1:/d7QHZsfUAruXuBhyPITqoYOmJ+nq35qPsJjz/aSpCg=
 github.com/btcsuite/btcwallet v0.0.0-20190313032608-acf3b04b0273/go.mod h1:mkOYY8/psBiL5E+Wb0V7M0o+N7NXi2SZJz6+RKkncIc=
 github.com/btcsuite/btcwallet v0.0.0-20190319010515-89ab2044f962/go.mod h1:qMi4jGpAO6YRsd81RYDG7o5pBIGqN9faCioJdagLu64=
-github.com/btcsuite/btcwallet v0.0.0-20190614043544-a335c566148c h1:9fQATx2+LheGbExN2jYuPJXNkvve5/9n/1EaUhzsZf0=
-github.com/btcsuite/btcwallet v0.0.0-20190614043544-a335c566148c/go.mod h1:GlcKHrCBxtujd/6coLUvczN68EkaBezgyN+JnEGVDUY=
+github.com/btcsuite/btcwallet v0.0.0-20190619005538-de02d6fdfb23 h1:tja9kILSaG27Z/kiR91dxmMk3T5+qplNLOxWT8iShKg=
+github.com/btcsuite/btcwallet v0.0.0-20190619005538-de02d6fdfb23/go.mod h1:GlcKHrCBxtujd/6coLUvczN68EkaBezgyN+JnEGVDUY=
 github.com/btcsuite/fastsha256 v0.0.0-20160815193821-637e65642941 h1:kij1x2aL7VE6gtx8KMIt8PGPgI5GV9LgtHFG5KaEMPY=
 github.com/btcsuite/fastsha256 v0.0.0-20160815193821-637e65642941/go.mod h1:QcFA8DZHtuIAdYKCq/BzELOaznRsCvwf4zTPmaYwaig=
 github.com/btcsuite/go-socks v0.0.0-20170105172521-4720035b7bfd h1:R/opQEbFEy9JGkIguV40SvRY1uliPX8ifOvi6ICsFCw=
diff --git a/lnwallet/btcwallet/btcwallet.go b/lnwallet/btcwallet/btcwallet.go
index 966cbb5b..268d8dd4 100644
--- a/lnwallet/btcwallet/btcwallet.go
+++ b/lnwallet/btcwallet/btcwallet.go
@@ -330,7 +330,14 @@ func (b *BtcWallet) CreateSimpleTx(outputs []*wire.TxOut,
 		return nil, lnwallet.ErrNoOutputs
 	}
 	for _, output := range outputs {
-		err := txrules.CheckOutput(output, feeSatPerKB)
+		// When checking an output for things like dusty-ness, we'll
+		// use the default mempool relay fee rather than the target
+		// effective fee rate to ensure accuracy. Otherwise, we may
+		// mistakenly mark small-ish, but not quite dust output as
+		// dust.
+		err := txrules.CheckOutput(
+			output, txrules.DefaultRelayFeePerKb,
+		)
 		if err != nil {
 			return nil, err
 		}
diff --git a/lnwallet/interface_test.go b/lnwallet/interface_test.go
index 4d30d07f..0f966263 100644
--- a/lnwallet/interface_test.go
+++ b/lnwallet/interface_test.go
@@ -2246,7 +2246,7 @@ func testCreateSimpleTx(r *rpctest.Harness, w *lnwallet.LightningWallet,
 		},
 
 		{
-			outVals: []int64{1e3},
+			outVals: []int64{200},
 			feeRate: 2500,
 			valid:   false, // Dust output.
 		},
@@ -2279,7 +2279,7 @@ func testCreateSimpleTx(r *rpctest.Harness, w *lnwallet.LightningWallet,
 		},
 	}
 
-	for _, test := range testCases {
+	for i, test := range testCases {
 		feeRate := test.feeRate
 
 		// Grab some fresh addresses from the miner that we will send
@@ -2308,10 +2308,15 @@ func testCreateSimpleTx(r *rpctest.Harness, w *lnwallet.LightningWallet,
 		createTx, createErr := w.CreateSimpleTx(
 			outputs, feeRate, true,
 		)
-		if test.valid == (createErr != nil) {
+		switch {
+		case test.valid && createErr != nil:
 			fmt.Println(spew.Sdump(createTx.Tx))
 			t.Fatalf("got unexpected error when creating tx: %v",
 				createErr)
+
+		case !test.valid && createErr == nil:
+			t.Fatalf("test #%v should have failed on tx "+
+				"creation", i)
 		}
 
 		// Also send to these outputs. This should result in a tx
@@ -2319,9 +2324,13 @@ func testCreateSimpleTx(r *rpctest.Harness, w *lnwallet.LightningWallet,
 		// only difference is that the dry run tx is not signed, and
 		// that the change output position might be different.
 		tx, sendErr := w.SendOutputs(outputs, feeRate)
-		if test.valid == (sendErr != nil) {
+		switch {
+		case test.valid && sendErr != nil:
 			t.Fatalf("got unexpected error when sending tx: %v",
 				sendErr)
+
+		case !test.valid && sendErr == nil:
+			t.Fatalf("test #%v should fail for tx sending", i)
 		}
 
 		// We expected either both to not fail, or both to fail with