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.
Texas offers a simplified probate process for estates of less than $50,000. However, for estates above $50,000, the process can take upwards of a year, especially if there are multiple beneficiaries, disputes among heirs, or issues with creditors. Also, the probate process can be costly.
Many families opt to take affirmative steps to avoid the probate process as much as possible. Several simple steps can be taken to reduce the assets that are subject to probate. These include:
- Beneficiary designations: Texas law permits both account holders to use Payable on Death (POD) and Transfer on Death (TOD) designations. These designations will automatically transfer the assets in the account to the named beneficiary, avoiding the probate process.
- Joint tenancy: If property is jointly held by two or more people, if one of the owners dies, the property will pass to the remaining owners without the need for probate.
- Revocable living trust: A revocable living trust allows someone to transfer the legal title of their assets into a trust while still maintaining control of the assets during their life. When the person passes away or becomes unable to manage the trust, another named trustee will take over the process and ultimately distribute the assets according to the trust document.
Is Your Houston Estate Plan in Order?
If you do not have a Houston estate plan, or it has been years since your estate plan has been modified, contact the dedicated Houston estate planning attorneys at McCulloch Miller, PLLC. Our dedicated team of attorneys works with families throughout Harris County and the Houston metro area. To learn more, and to schedule a consultation today, call 713-333-8900.