Texas state probate law requires that all estate assets are gathered and that all the decedent’s remaining debts get settled out of those assets. Only after all liabilities have been resolved can the estate’s assets be allocated to the beneficiaries as outlined in the will or, if there is no will, according to Texas intestate succession laws.
Several estate assets do not pass through the probate process. For instance, any retirement account or life insurance policy with a named beneficiary will move to the recipient outside probate. The beneficiary should contact the company which issues the plan to discuss which forms need to be filled out.
Additionally, any community property held with right of survivorship or property help in joint tenancy with right of survivorship does not proceed through probate either. Instead, the decedent’s interest in the property dissolves at death, awarding the other joint owner as of the sole owner.
If the decedent created a trust, then the trust assets are not part of the estate either. The trustee appointed in the trust will allocate the assets to the designated beneficiaries.
Probate is the process of how estates get resolved through Texas court. The process occurs if you have left a valid will and is a method of ensuring that beneficiaries get notified and that assets get adequately valued and allocated after a person’s passing. It is the primary method of preventing estate fraud as well. However, numerous people find the process to be long and complicated, as well as confusing.
Do all estates and assets need to undergo the probate process?
No. Estates that are smaller than the specified threshold may go through a more straightforward process using an affidavit. Additionally, certain kinds of assets may be automatically transferred to their rightful heirs without the probate process.
These assets include:
Assets owned under joint tenancy: When holding something jointly with another person, you become the sole owner in the event of the other owner’s death. There are certain types of joint tenancy, such as “community property with right of survivorship or tenancy by the entirety,” which are exclusively available only for married couples.
Beneficiary designations: There are some assets, like life insurance policies, which have specifically named beneficiaries. When you die, your life insurance payout goes directly to the recipient without the need for probate.
Payable on Death accounts: Several bank accounts may also have appointed beneficiaries. When you die, your brokerage or bank account could go to the recipient without passing through probate.
Transfer on Death deeds: After September 1st, 2015, you are permitted to specify who gets your property after you die in a deed. That asset will not need to pass through probate.
Another alternative to avoid probate: the living trust
If you want your estate or specific assets in it to circumvent probate, you may place your assets into a living trust. Anything in the living trust won’t pass through probate unless the assets you’ve left outside of the trust are higher in value than the small estate limit in Texas.
Anything can go into a living trust like bank accounts, houses, vehicles, or other property. You begin by naming yourself as the trustee. Next, you nominate someone else to step in as the trustee when you pass away. Then, anything that is in the living trust goes directly to the trustee upon your passing.
How probate works
Independent and Dependent Administration are the two types of probate in Texas.
Independent Administration is the more straightforward, economical option. An executor can request this kind of probate if it is permitted in the will or if none of the named beneficiaries oppose, the will is not specific about the probate allowable or if there isn’t a will altogether.
With independent administration, court oversight is not necessary, and the executor can sort out the estate unsupervised. If you are the executor, you will also not be required to post a bond or need an insurance policy that cushions the estate against the chance of failed management on behalf of the executor. It is necessary to publish a probate notice still so any creditors can locate and find out about the death of the decedent and file an asset inventory.
Dependent administration is the opposite of independent administration and is a court-supervised process. The court oversees and approves all the steps that the executor takes, and there is a forum to resolve challenged estates and disputes that occur between beneficiaries.
Probate in Texas is more straightforward than it is in many other states, and that is primarily due to the commonly used independent administration process. Set your assets into a living trust, name your beneficiaries whenever feasible, and you will be able to help your loved ones circumvent probate.
Schedule a Consultation Today to Discuss Estate Planning
There are multiple aspects of probating in Texas. The procedure is naturally an experience no one would want to undergo alone. Fortunately, you don’t have to. Our team of attorneys has over 35 years of experience helping families plan for their futures, protecting surviving spouses, and safeguarding assets for loved ones. We welcome you to call the Voeller Law Firm today at (210) 651-3851 to request a consultation and learn more about estate planning. We are proud to serve the greater San Antonio, Bexar County, Comal County, Guadalupe County, and South Texas areas.
Our services go far beyond merely preparing – we do our best to help you protect your future.