Probate

How to Avoid Probate in Texas

Published on: April 1, 2022 | By Thomas W. McCulloch

The estate planning process can be complicated for those just beginning since there is a lot to learn. Because of this, most people do not know how probate can impact estate planning overall. Probate is the court administration of an individual’s estate—which occurs after they have passed away. Depending on the amount of planning an individual has done before they die, the probate process may either be smooth or difficult. Below are some common questions and explanations about the probate process and how Texas estate planning attorneys advise their clients on these issues.

What is Probate?

After a person’s death, the court reviews the deceased’s debts in probate—if they had any—and then distributes their remaining assets to loved ones. Most people are surprised that regardless of if the person had a will or not, they will go through the probate process. If the person had a will in place, called a testate, then the process is much easier and is less likely to be questioned. However, if the person did not have a will, called intestate, the process is often much more complicated. This is another reason why it is critical to have an estate plan in place.

What Does it Mean to Die Intestate in Texas?

Published on: March 29, 2022 | By Thomas W. McCulloch

Life happens, we get it. Therefore, most individuals put off estate planning. However, there are major downsides when this is avoided for too long and they unexpectedly pass away. When someone dies without a will, it is called dying intestate. There are many consequences dying intestate in Texas, including that the decedent does not get to choose who will receive their assets— their funds, property, and items. Because there are benefits to drafting an estate plan and ensuring one does not die intestate, below are examples of the dangers of intestate property and resolution to this issue.

What Problems Can Arise from Not Having an Estate Plan?

When someone dies without a will, they do not have the ability to decide who will receive their possessions. This occurred to famous artist Henry Darger, whose family entered into a long-drawn-out legal battle. When Darger died without a will in place, his landlords—who helped bring notoriety to his art—had ownership of his pieces of art, some of which have been appraised at close to $800,000. Now, long-lost relatives of Darger have filed a lawsuit, arguing they are the rightful beneficiaries of his property. The landlords are arguing that Darger told them that they could keep or discard his possessions.

How to Determine if a Particular Asset is Included in a Texas Estate Plan

Published on: January 31, 2022 | By McCulloch & Miller, PLLC

While Texans often have an overview of the estate planning process, most are unclear of the specifics that constitute an estate plan. Many people will then ask whether a certain asset is included in their estate. However, the answer to this question is highly dependent on the asset itself and how the person is defining “their estate”—as estate can have various meanings. Because this designation may be confusing, estate planning attorneys are here to answer these questions and help Texans in crafting their estate plans.

What Assets are in My “Estate?”

When a person passes away, their estate has different meanings depending on the context. It may refer to their estate for estate tax purposes, their probate estate, or whether an asset is able to be passed onto their heirs. Many people are unaware they must pay a tax if their estate is valued over a certain amount. Individuals whose estate is worth more than $12.06 million must pay a federal estate tax. There is no state estate tax in Texas.

The Benefits of Having an Attorney Through Texas Probate Proceedings

Published on: October 13, 2020 | By McCulloch & Miller, PLLC

Under Texas law, the probate process is triggered when a person dies and leaves property without directly transferring ownership to another party. Probate is the process in which a court recognizes a person’s death, resolves debts, and distributes assets according to their will. If the decedent dies with a will, the estate’s representative or executor must file for probate. In situations where a person does not leave a will, the person’s assets and debts will go through intestacy laws.

The probate process requires a court to determine whether a will is valid. After hearing arguments on the will, the court will appoint a person to administer the estate and determine heirs. After determining heirs, the court will notify creditors of the death and allow them to file claims on any debts the estate may owe. After creditors make their claims, the court will distribute assets and resolve any disputes.

Families should understand that there are two main types of probate processes, “independent administration” and “dependent administration.” Independent administration cases tend to be quicker and less expensive. In most cases, however, the will must provide for independent administration. There are ways to get around this requirement if the lawyer or executor makes the appropriate argument to the court. On the other hand, dependent administration of estates occurs when there is any dispute regarding the beneficiaries or asset distribution.

What Constitutes Non-Probate Property in Texas?

Published on: October 3, 2020 | By McCulloch & Miller, PLLC

Probate is the process in which the court validates a will and distributes the deceased’s property according to the terms of their will. While probate is the default process in many situations, there are ways to avoid this lengthy and potentially costly process. In fact, one of the primary purposes of a Houston estate plan is to avoid probate.

Assets that are mentioned in a will are typically passed on to those named in the will. However, certain classes of assets are referred to as non-probate property. Non-probate property consists of those assets that will automatically pass on to the beneficiary at the time of the owner’s death. There are several types of non-probate property.

Jointly Held Property

Avoiding Probate Through Effective Texas Estate Planning

Published on: July 14, 2020 | By McCulloch & Miller, PLLC

Depending on the situation, the probate process can be a nightmare. For this reason, many believe probate should be avoided whenever possible. However, avoiding probate depends on the circumstances of each individual situation. While creating a Houston estate plan that avoids probate will be beneficial in most circumstances, there are certainly some situations where the level of planning required to avoid probate is unnecessary.

What is Probate?

Probate is the court-guided process through which a decedent’s property is distributed accordingly. Through this process, the court authenticates the decedent’s will, notifies potential heirs, accounts for the decedent’s property, and addresses tax obligations before estate property is distributed to beneficiaries. The court is also responsible for appointing an executor of the estate to oversee the process and protect the interests of the estate and its beneficiaries. In the case of an intestate estate (where the decedent dies without a will) probate serves the same functions, with the only difference being that property is ultimately distributed according to state intestacy laws.

The Texas Probate Process and How to Avoid It

Published on: May 4, 2020 | By McCulloch & Miller, PLLC

When discussing Houston estate planning, there are likely to be many unfamiliar terms. Among these terms is the concept of “probate.” Probate is the part of the process by which assets are transferred after death, and specifically refers to the validation of a person’s will. However, the probate process is often lengthy and costly, and is also public.

To better conceptualize what probate is, it helps to have an understanding of the basics of Houston estate planning, starting with wills. Quite simply, a will is a document in which someone outlines how they want their property distributed upon their death. Those who pass away without a will are said to have died “intestate.” In such cases, state law will dictate how their property is passed on to their successors. Of course, the Texas intestate laws are generic and not customized to anyone’s individual needs. Thus, those who wish to maintain control over their assets typically create a will.

When someone with a will dies, that person’s will must be presented to the probate court within four years. If a will is not filed within that time, then the state’s intestacy laws will likely be used to distribute the decedent’s assets. However, if a will is timely presented, the probate court will officially acknowledge the person’s death, oversee payment of their remaining debts, and distribute their assets according to the terms of the will.

Do I Need a Revocable Living Trust?

Published on: April 2, 2020 | By McCulloch & Miller, PLLC

Accounting sheet
Do you ever worry about how your beneficiaries will manage their portion of their inheritance when you pass away? One solution that allows you to still exert some control over your money–even after passing–is with a revocable living trust (RLT).”

A revocable living trust is created with a written agreement or declaration that names a trustee to manage and administer the property of the grantor. As the grantor, or creator of the trust, you can name any competent adult as your trustee, or you can use a bank or a trust company for this role. The grantor can also act as trustee throughout his lifetime.

Investopedia’s article from last fall entitled “Should You Set up a Revocable Living Trust?” explains that after it’s created, you must re-title assets—like investments, bank accounts, and real estate—into the trust. You no longer “own” those assets directly. Instead, they belong to the trust and don’t have to go through probate at your death. However, with a revocable living trust, you retain control of the assets while you’re alive, even though they no longer belong to you directly. A revocable living trust can be changed, and any income earned by the trust’s assets passes to you and is taxable. However, the assets themselves don’t transfer from the trust to your beneficiaries until your death.

Why are IRA Beneficiary Designations So Important?

Published on: January 22, 2020 | By McCulloch & Miller, PLLC

If you pass away without naming beneficiaries in your will, it can create legal entanglements for your heirs.

If you decide to purchase a life insurance policy or to put some money into a new deferred annuity contract or Individual Retirement Account (IRA), you need to complete the beneficiary form.

However, Investopedia’s recent article entitled “Why Your Will Should Name Designated Beneficiaries” says that you may just name a person as a beneficiary, without fully appreciating this aspect of your estate planning.

Can Beneficiaries Push Back on a Bad Temporary Administrator?

Published on: November 22, 2019 | By McCulloch & Miller, PLLC

If a temporary administrator has failed to perform their duties properly, the court has the power to remove this person.

Beneficiaries need to know that they have rights too. If a temporary administrator is not following the terms of the will, taking money that belongs to the estate or failing to perform their fiduciary duties, it’s time to go to court.

nj.com’s recent article, “What to do if an estate administrator isn’t doing his job,” explains that a temporary administrator is usually appointed by a probate judge, because the named executor has died, renounced his or her rights to serve, or is unable to serve.