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Understanding Texas Probate Process

Settling Estates Through the Court

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Texas probate law requires that all estate assets are gathered and that the deceased person’s remaining debts get paid out of those assets. Only after all debts have been paid can the estate’s assets be distributed according to a will or, if there is no will, according to Texas intestate succession laws.

Some estate assets do not pass through the probate process. For example, any life insurance policy or retirement account with a named beneficiary will pass to the beneficiary outside probate. The beneficiary should contact the company which issued the policy to discuss what paperwork they should fill out.

Also, any property held in joint tenancy with right of survivorship or community property with right of survivorship does not pass through probate, either. Instead, the deceased person’s interest in the property vanishes at death, leaving the other joint owner the sole owner.

If the deceased created a trust, then trust assets are not part of the estate, either. The trustee named in the trust will distribute assets to named beneficiaries.

Probate is how estates get settled through Texas court. This process occurs even if you have left a will, and it’s a way to ensure that beneficiaries get notified and assets get properly valued and distributed after a person’s death. It’s also a primary way of preventing estate fraud. But many people find it a long, challenging and confusing process.

Do all estates and assets need to go through probate?

NO. Estates smaller than a certain threshold can go through a simplified process using an affidavit. Also, certain types of assets can be automatically transferred to heirs without going through the probate process.

These include:

Assets owned under joint tenancy. If you own something jointly with someone else, you become the sole owner in the event of the other person’s death. There are certain kinds of joint tenancy, such as “community property with right of survivorship” or tenancy by the entirety,” which are only for married spouses.

Beneficiary designations. Some assets, such as life insurance policies, have specifically named beneficiaries. If you die, your life insurance payout goes straight to the beneficiary without going through probate.

Payable on Death accounts. Some bank accounts can also have named beneficiaries. If you die, your bank or brokerage account could also go to the beneficiary without passing through probate.

Transfer on Death deeds. Beginning September 1, 2015, you’re allowed to specify who gets a property after you die in the deed. That asset won’t need to pass through probate.

Other ways to avoid probate: the Living Trust

If you want your estate or certain assets in it to avoid probate, you can put your assets into a Living Trust. Anything in the Living Trust won’t go through probate, unless the assets you’ve left outside the Trust are higher than the small estate limit in Texas.

Anything can go in a Living Trust—houses or vehicles, bank accounts, or other property. First, you name yourself as the trustee. Then, you name someone to step in as trustee after you die. Anything in the Living Trust will go to the trustee after your death.

How probate works

There are two types of probate in Texas: Independent or Dependent Administration.

Independent Administration is the cheaper, easier way.
An executor can request this type of probate if it’s allowed in the will—or if none of the beneficiaries object, if there isn’t a will or the will doesn’t specify.

Under this type of probate, court supervision isn’t required—and the executor can settle the estate unsupervised. You also don’t need to post a bond, or get an insurance policy that shields the estate against executor mismanagement. It’s still necessary to publish probate notice so any creditors can find out about the death—and to file an asset inventory.

Dependent Administration is a court-supervised process. All steps the executor takes must be approved by the court; and there is a forum to resolve contested estates and disputes between beneficiaries.

Probate in Texas is simpler than it is in many other states—and that’s primarily due to the Independent Administration process, which is the most commonly used. Name your beneficiaries whenever possible and put your assets in a Living Trust, and you should be able to help your loved ones avoid probate.

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Disclaimer: Elder Options of Texas is not rendering any legal or professional advice.  If legal advice is necessary the reader should consult a competent attorney..

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