Probate’s Two Purposes
When a loved one passes away with or without a Will, his or her estate often goes through a court-managed process called probate. The purpose of probate is twofold:
- To ensure the deceased’s valid debts are paid; and,
- Transfer ownership of property that does not pass by contract law (such as most savings accounts and life insurance policies, for example).
Directing Post-Death Affairs
The person the court authorizes to carry out the intent of a Will is called the Executor. The person authorized to distributed property per the laws of Texas when no Will exists is called the Administrator. Executors and Administrators work under a probate court’s supervision to a degree that varies with the estate’s circumstances.
The person authorized to manage a Trust is called the Trustee. Generally, probate does not concern Trust assets and Trustees work outside of the court’s supervision.
How Long Probate Takes
Factors Affecting Time
The length of time needed to complete the probate of an estate largely depends on four factors:
- The size and complexity of the estate to include property and debts;
- Whether “dependent” or “independent” administration is authorized;
- Whether any named beneficiary or excluded person intends to challenge the Will; and,
- The probate court’s schedule.
Independent administration tends to go faster because court supervision is minimal. Dependent administration tends to go slower because court approval is required for nearly every action.
“Short Form” Probate
A series of alternatives best described as “short-form” probate might be available if the estate meets certain requirements.
For example, a Small Estate Affidavit might be an available “short form” of probate if:
- The decedent died without leaving a Will;
- The estate’s assets (excluding the homestead) do not exceed $50,000; and,
- Estate assets exceed the liabilities.
Obtaining a court order admitting the Small Estate Affidavit generally takes about a month’s time or less. With order in hand, the “distributees” (i.e. persons entitled to property) can go about collecting the estate and paying the debts.
Another “short form” option is to probate the Will as a “Muniment of Title,” which is available if:
- No unpaid debts exist other than a mortgage lien on real property; and,
- Only the deceased’s personal property and real property (all of which is located in Texas) require transfer.
Obtaining a court order admitting the Will as a Muniment of Title also generally takes about a month’s time.
Altogether, the full probate process can run anywhere from a few months to a year or more. The bulk of estates fall somewhere between 9 to 18 months, if litigation isn’t involved. A qualified attorney will be able to give you a realistic idea of what to expect after discussing the specific facts of your case.
The Steps Involved in Probate
The full probate process typically involves the following major steps:
- Filing of a petition with the proper probate court.
- Appointment and qualification of the Executor.
- Notice to secured and unsecured creditors.
- Notice to beneficiaries under the Will.
- Inventory and appraisal of estate assets by Executor
- Sale of estate assets, as needed to pay valid debts.
- Payment of estate debt to rightful creditors.
- Payment of estate taxes, if applicable.
- Final distribution of assets to beneficiaries.
Frequently Asked Questions
What happens if someone objects to the will?
There may be a long and costly battle. An objection to a Will, also known as a “Will contest” occasionally happens during the probate proceedings and can be incredibly costly to litigate.
In order to contest a Will, one has to have legal “standing” to raise objections. This usually occurs when, for example, children are to receive disproportionate shares under the Will, or when distribution schemes change from a prior Will to a later Will. In addition to disputes over the tangible distributions, Will contests can be a quarrel over the person designated to serve as Executor.
Does probate administer all property of the deceased?
Typically, no. Certain types of assets are “non-probate assets.” These include:
- Property in which you own title as “joint tenants with right of survivorship”. Such property passes to the co-owners by operation of law and does not go through probate.
- Retirement accounts such as IRA and 401(k) accounts where there are designated beneficiaries.
- Life insurance policies where a person or Trust (and not the deceased’s estate) is named as beneficiary.
- Bank accounts with “pay on death” (POD) designations or “in trust for” designations.
- Property owned by a Living Trust. Legal title to such property passes to successor Trustees without having to go through probate.
Do I get paid for serving as an Executor?
It’s possible. Executors can be reimbursed for all legitimate out-of-pocket expenses incurred in the process of management and distribution of the deceased’s estate. In addition, you may be entitled to statutory fees, which tied to the size of the probate estate.
Is the Executor Liable for Actions Taken?
Yes. The Executor has to fulfill his or her fiduciary duties on behalf of the estate with the highest degree of integrity. The Executor can be held liable for mismanagement of estate assets in his or her care. An Executor should retain an attorney and an accountant to advise and assist with the Executor’s duties.
How much does probate cost?
It varies depending on the complexity of the Will and the estate (i.e. number/types of beneficiaries and composition of assets and liabilities). A Small Estate Affidavit or Muniment of Title can cost roughly $1K. A full probate, such as an Independent Administration, will cost more because of the number and complexity of steps involved as compared to “short form” probate options. A qualified probate attorney will be able to give a good estimates of costs and fees after discussing the specific facts of your case. It should be remembered that all costs generally are paid from estate assets.