Frequently Asked Questions About Probate
Does a Will have to be probated?
The Texas Estates Code requires a person to deliver a will to the County Clerk after the testator has died, but the question of whether to probate the will is actually more complex than it seems. If (1) the estate is small, (2) the person who would receive everything under the Will already has possession of those items, (3) there are no debts to be paid, and (4) the decedent's name does not appear on any deed, car title, or other similar assets, there may not be any need for a probate. However, this situation is clearly the exception rather than the rule, because in most estates a probate will be necessary to remove the decedent's name from one or more deeds, car titles, accounts, etc. At least the very least you should consult with an experienced Texas probate attorney to make sure there are no unforeseen problems before you make the decision not to probate a Will.
When should I probate the Will?
Absent unusual circumstances you will need to wait until you have received the death certificate from the funeral home or the Department of Vital Statistics. On the other hand, you will not be able to probate a Will more than four years after the date of death unless you can show good cause for the delay. In between these two dates it is largely up to you when you file. As a rule of thumb, though, sooner is better. As time passes, memories fade and records get lost, making it more difficult to reconstruct the decedent's affairs. In addition, there may be a need to promptly wrap up certain matters, such as claims of the estate's creditors, filing the final income tax return, and the like. Delay can also cause suspicion and resentment to develop among those who are expecting to receive a gift under the Will. Finally, waiting increases the risk that someone else (perhaps a beneficiary or the executor) will pass away, potentially resulting in the need to coordinate the administration of two (or more) estates simultaneously. If you are contemplating waiting to file a Will for probate, you may wish to contact a Texas probate lawyer to discuss specific advantages and disadvantages associated with your particular case.
How much will a probate cost and how long will it take?
The answers to these questions depend on the complexity of the estate. A large estate with an ongoing business, assets located in other states, and numerous beneficiaries (some of whom may be minors) is obviously going to cost more money and take longer to wrap up than a small estate in which all debts are paid, no assets are in another state, and everything passes to one adult. However, Texas probate law is remarkably efficient. As a result, many of the probates we handle cost less than $2000, require only one brief court appearance by the executor, and are mostly (if not completely) done within a few months. Clients frequently find this is significantly less than the cost of setting up a trust to try to avoid probate, and a lot less hassle as well.
Is it true that if I probate the Will I become liable for the estate's debts?
No, the mere act of probating the Will does not make you personally liable. You can become liable if you accept an asset from the estate that hasn't been paid for (a vehicle with a lien, or a home with a mortgage, for example), but your liability is limited to the amount owed on the item you have accepted. Also, an executor can be held liable for mismanaging the estate.
What are "Letters Testamentary?"
Letters Testamentary are an official court document that proves the independent executor's authority to act on behalf of the estate. (In a sense, they are like a power of attorney authorizing the executor to act as the agent of the estate). Parties dealing with the executor during the administration of the estate frequently request letters testamentary. Additional letters can be obtained from the court at any time during the administration.
What does the executor do?
The primary duties of the executor are to collect and preserve the assets of the estate, to pay all proper debts and taxes, and finally, to distribute the remainder of the estate as provided by the Will. The executor's specific duties will vary depending on the needs of the estate, but the types of activities the executor will frequently need to undertake include:
- Terminate or alter services and deliveries supplied to the decedent, if necessary. The Post Office should be supplied with a forwarding address for the decedent's mail if appropriate.
- If there are credit cards in the decedent's name, attention should be given to terminating the credit, after considering any need for the surviving spouse to have access to credit cards.
- If services are necessary for the maintenance of real property, arrangements should be made for the services to be continued.
- The decedent's employer or business associates should be contacted. The executor may need to take steps to ensure that an active business keeps operating, or that a business be sold. The executor should also ascertain whether any death benefits or insurance benefits are available.
- The executor should notify the appropriate family members that they may be eligible for certain Social Security benefits or Veterans Administration benefits.
- Insurance policies should be located and delivered to the named beneficiary so the beneficiary can apply for the benefits. The policy and a certified copy of the death certificate should be presented with the claim. If the claim is mailed to the company, it should be sent by certified or registered mail. Before submitting any insurance policies for benefits, the executor should make a copy of the entire policy and all attachments, as they are frequently requested in the event of an estate tax audit.
- The executor should determine whether it is advisable to continue various types of liability and loss of insurance coverage and, if so, take any steps necessary to continue such coverage.
- Locate and consolidate the assets of the estate. Unless the Will specifies that a particular item be delivered to someone (a coin collection to a favorite nephew, for example) an executor will sometimes find it convenient to sell some or all the assets and distribute cash instead.
Should I open an "estate account"?
In certain simple estates, such as in the case of a probate as muniment of title, there is no need to open a separate account for the estate. However, if there are debts to be paid, or if the estate will be kept open for a time in order for assets to be collected or sold, the executor should open an estate account. The account should be opened in the executor's name "as independent executor" of the decedent's estate. The bank will require the estate's taxpayer identification number, which is not the same as the Social Security number of the executor or the decedent.
What about income and estate tax considerations?
First, a caveat: we are not tax lawyers. Questions regarding tax issues beyond a basic level will need to be directed to an accountant or C.P.A. Ideally the executor will engage the services of a tax professional early in the process to assist in setting up a proper recordkeeping system for the estate, and preparing any necessary tax returns. In most cases it will be necessary for the executor to file the decedent's final 1040, and in some larger estates an estate tax return may be required as well. The IRS web site has additional helpful information about these issues.
About the Firm
Roberts & Roberts is a Killeen, Texas law firm which provides legal services in the fields of probate, estate planning, real estate, and business law. If you have questions about Texas probate law, or if you need a Bell County probate lawyer, we would welcome the opportunity to assist you.