At Ezell & Ezell, we know that dealing with the loss of a loved one is difficult enough before you must address the legal matters involved. Navigating between the law and the wishes of your family members can be a difficult process filled with uncertainty. Allow us to guide you through that journey and take the burden off your shoulders. Do you live out of town or out of state? No problem. We are happy to help you from here and most probate processes can be handled from anywhere.
What is Probate?
After death, a person’s property must be properly distributed to the correct persons. Debts and claims must be paid or negotiated and settled. This is the probate process in a nutshell. In Texas, we are lucky to have very good probate laws that make the probate process easier than in many other states. Texas law affords you several different options to complete the probate process.
What Probate Process is Right for You?
The first question to ask is whether or not there was a will. The rules and procedures for handling estates with and without wills are very different. Next, we look at what property is in the estate and what we can expect from family, creditors or other interested persons. After we know those facts, we can pick the best process for your case. There area many processes to chose from and they are different for estates with wills and without wills. Please refer to the sections below on Probate Options When there is a Will (Testate Estates) and Probate Options When there is not a Will (Intestate Estates) for a more in depth discussion of the probate processes available to you.
Was there a Trust? Trusts estates are handled in a completely different manner from wills. There are many different types of trusts which are created for many different purposes. In order to know how to handle a trust estate, it is important to look at the trust document for guidance as each trust has a specific set of instructions.
WILL CONTESTS AND LITIGATION
Most of the time, estates are settled fairly and properly without disagreement or problems that lead to litigation. However, litigation sometimes arises when there are serious questions or disagreements over whether a will was signed as a result of fraud or duress or when the testator did not have the mental capacity to sign the will. Other times executors and administrators fail to properly execute their duties or commit fraud upon the estate. These are serious issues that lead to litigation. We are here to help you should you find yourself in a situation where litigation may be necessary. Whether or not litigation will be involved, the first step is to choose which probate option is right for you. Below is a list some of the most frequently used and discussed probate processes in Texas. It is very likely that your needs will be met by one of these options.
A Warning on Waiting too Long to Handle Estates – Do not wait very long to tackle these issues. If you wait too long, you loose the right to have an administration if one is necessary.
MEDICAID ESTATE RECOVERY PROGRAM (MERP) – DON’T LET MERP GET THE HOUSE –The Medicaid Estate Recovery Program (MERP) is the program by which the federal government seeks to take the assets of some deceased persons, including their homes, to reimburse Medicaid for expenses expended on the deceased person, leaving nothing for their families. THERE IS HELP IN TEXAS! Texas law gives Texans tools to avoid MERP claims before they begin. A Lady bird deed also known as enhanced life estate deed or a transfer on death deed can save your home. Other planning can also help. Advance Planning is key! CALL US to see how to protect your home from MERP. If you have already received a MERP claim letter, CALL US. For some people, there are also ways to avoid or reduce MERP claims after they have become a reality. We can help many people avoid or reduce MERP claims.
MORE INFORMATION REGARDING TEXAS PROBATE PROCESSES
Probate Options When there is a Will (Testate Estates)
Independent Probate Administration
When there is a will naming an independent executor, the probate process can be fairly simple and straight forward. Only one court hearing is usually required and most other matters can be handled free of court supervision. Complicated assets or quarrels between the family or beneficiaries can make things more involved and expensive. However, for most people, the process is usually simple and streamlined. This is a situation where you enjoy the benefits of your loved one’s estate planning efforts.
Dependent Probate Administration
This type of administration requires court supervision at almost every turn. It is more expensive and time consuming, however, it provides a greater level of protection to the beneficiaries and the executor than an independent administration. It is used when the will directs there be a dependent administration, when there is conflict among the parties involved or when they do not agree to an independent administration.
Probate of Will as a Muniment of Title Only
This process is used when there is a will but an administration of the estate is not necessary. It serves only to transfer title to the property and no executor is appointed. It is useful in limited circumstances, usually when there are no debts (except debts secured by real estate) and the only assets to transfer are personal property items and real estate. We always consider using it because it is less expensive and time consuming than an administration. This option is often not available when there are unpaid debts or the decedent received Medicaid benefits while alive due to the existence of the Medicaid Estate Recovery Program (MERP). A discussion of MERP should always be had when discussing probate processes. You should always look to see if your loved one did any estate planning including a “Lady Bird Deed” or a “Transfer on Death Deed.” The existence of such a deed may defeat a MERP claim. If your loved one received medicaid in their lifetime, look to the MERP section herein for more information. If you may one day need long term care, it would be good for your knowledge as well. Another limitation of the muniment of title is that it is not a good tool to collect financial assets as financial institutions routinely refuse to accept this method of property transfer. Before deciding on a Muniment of Title proceeding, you should be very sure that
all the assets can be transferred this way and that there are no debts owing. If you later find assets or debts, you will likely have to also open up a probate estate which will result in additional cost.
Affidavit of Heirship
It is most often used when there is not a will, but may be used when there is a will in very limited circumstances when the decedent left all of his assets in the will in exactly the same manner as if the decedent has died intestate. The Affidavit of Heirship is one of the easiest ways to transfer property because no court involvement is required. However, it is only available in very limited circumstances. It is mostly used to transfer title to real estate or cars and should only be used when there are no debts, including claims from the Mediciad Estate Recovery Program (MERP.). Because of its informal nature, it is not favored by financial institutions or some title companies. If the decedent had a bank account that did not have a beneficiary designation, it is extremely doubtful that a person would be able to collect the funds in the account by presenting the bank with an affidavit of heirship. They almost always require an estate be opened or a judicial determination of the heirs. Additionally, an Affidavit of Heirship must be properly used, drafted and recorded to achieve its purpose. If it is not done properly, it can cause a cloud on title to real estate and several other problems. It is generally used when someone died without a will. This document must be signed by the affiant and two disinterested witnesses who knew the decedent and can swear no debts are owed by the Decedent.
Small Estate Affidavit
The Small Estate Affidavit is similar to the Affidavit of Heirship, however, a court must be involved to review the affidavit and enter an order. It is only available when the the Decedent had no will and if the Decedent’s estate is valued at less than $50,000 in assets, exclusive of the homestead and exempt assets. Assets passing outside of the probate estate such as pay on death bank accounts will not county against the $50K. Also, the assets of the estate must exceed the debts and there can be not debts other than those secured by the homestead. It can’t be used to transfer any real property interest other than the homestead and, then, you can only use it if the homestead is to be transferred to a person who will also use it as a homestead, usually. a spouse or minor child who also lives in the home. Thus its application for real property is very limited. Furthermore, it may not be a good tool to collect financial accounts and insurance policies as financial institutions often refuse to accept this method of property transfer. Holders of financial accounts often want to make checks payable to an estate or have a judicial determination of heirship. It must be signed by every heir at law (or guardian) and two disinterested witnesses. Before deciding on a small estate affidavit, you should be sure it can be used to transfer every asset the decedent owned. Often times, you will find that you can’t use a small estate affidavit. However, in some situations, it works very well.
Probate Options When there is not a Will (Intestate Estates)
When there is no will, the Decedent is said to have died intestate. When a person dies intestate, the Texas rules of intestate succession take over. These rules determine who will inherit the Decedent’s property and lay out a very specific probate process that must be followed very closely. Settling an intestate estate may be fairly simple or it may be very complex. There are many different ways to handle an intestate estate. Which one is right for your case is based on several different factors including the type of assets owned at the time of death, the family structure and the agreement of the heirs.
Independent Administration of Decedent’s Estate
When there is no will and an administration of the Decedent’s estate is required, the probate process is always more complicated and expensive. That is because courts require much more work and supervision when the Decedent left no instructions on who should inherit his or her assets or who should be in charge of that process. The court is then called upon to make a judicial determination of who will inherit the assets based solely on the intestate succession laws of the State of Texas. The court will also have to appoint a person to be the “administrator” to handle all business for the estate. Texas courts do not take these tasks lightly and will require the administrator to follow a strict set of rules and guidelines both before and after the administrator is appointed. These rules and guidelines must be followed and the expenses associated therewith must be paid no matter if the estate is very small or very large or if there are two heirs or 10 heirs. The court will require you to provide two witnesses who knew the decedent, but are not direct heirs, to provide testimony detailing the Decedent’s family and history. Those witnesses may also have to appear before the court to explain such history to the judge. The court also appoints an independent Attorney Ad Litem to verify the family history and research any unknown heirs of the decedent and report to the court on their findings. If any minor children or disabled persons are involved, the court may appoint another attorney ad litem to represent their best interests. You will be required to pay the attorney ad litem’s fees before the court will hear your case.
Dependent Administration of Decedent’s Estate
This type of administration requires court supervision at almost every turn as opposed to an independent administration which has very little court supervision. It is used when the heirs do not agree to have an independent administration, when a judge feels uncomfortable with an independent administration or when there is conflict among the parties involved. It is more expensive and time consuming, however, it provide a greater level of protection to the heirs and the administrator.
Affidavit of Heirship
Please refer to the section above regarding Affidavits of Heirship.