Right from the beginning, something to know is the existence of a will does not force an estate into a probate proceeding and the lack of a will does not preclude an estate from a probate proceeding. The next thing to understand is that there are various methods of probate. The different paths of probate hinge mostly on these issues: 1) what are the assets owned by the decedent, or deceased, at the date of death and how are they owned? 2) was there a will or other testamentary document? What most people think of as “probate,” that is, going before a judge and moving through an administration process to get authority to transfer title to property, requires a necessity for administration. Necessity exists when debts are owed or there is property to be transferred that the distributees or beneficiaries cannot otherwise gain access or title to. If a full administration is not preferred or necessary, there may be other avenues for transferring title from the deceased’s estate to the deceased’s distributees such as Affidavits of Heirship, Small Estate Affidavit, and Muniments of Title. These other avenues are usually less costly than a full estate administration. So, do you need to go to probate? Maybe. Or maybe you have the option to work through a different form of probate.
The next thing to understand is the difference in a “probate asset” and “non-probate asset” (there are also trust assets which fall somewhere in the middle and will be addressed later). For purposes of this explanation, a probate asset is an asset that requires a court administration (independent administration, dependent administration, muniment of title, or some other document including a judge’s signature and/or recording in the county public record)
to gain access. If the asset is “stuck” in the deceased’s name or the name of the deceased’s estate, then it probably requires a probate process of some kind and is a “probate” asset. If the asset does not need a judge’s signature, court order, or something recorded in the real property records, it is probably a “non-probate” asset. These are typically assets that have beneficiary designations naming an individual or an existing trust or entity, or jointly owned with rights of survivorship. These assets often just need a death certificate, some paperwork, and some time.
Related Items: Marital Property and Trust Property
Two separate but related matters should be addressed here. The first is that in Texas, assets obtained during the marriage are presumed to be community property unless otherwise agreed, regardless of whose name is on the account or title. So if husband and wife, whether married 4 years or 40 years, acquired a house during the marriage and even if only the husband’s name is on the deed, wife still owns half the house. If wife dies and husband lives on, he may think he owns the entire house, after all, it is in his name. However, the truth is that wife’s estate would own ½ of the house upon her death and husband owns the other half. This interest does have to be addressed and it is a common misconception that nothing needs to be done in this scenario.
The second related matter, is in regards to trust-based estate plans. Having a trust-based plan does not always avoid probate. A trust is an instrument some individuals use in lieu of or in addition to their wills and other planning tools. The trust becomes owner of assets during the lifetime of the decedent and/or at the death of the decedent. Most trusts are not overseen by a judge or a court, and the trustee is left to administer the assets in the trust according to the trust terms during the lifetime of and at the death of the decedent. Although the formality of a probate process is not necessary when a decedent dies whose assets were all in trust and trust administration is more private compared to an administration in a court, there is almost always still work to be done. A trust is regularly administered upon the death of a decedent to create new trusts, pay final expenses, distribute assets to beneficiaries, and so on. The belief that a trust-based plan excludes your estate from probate may be true if everything you own is in the name of the trust, but it does not usually exclude your estate from administration costs. Additionally, often the deceased does not properly complete his or her trust funding, meaning not all the assets owned by the decedent were owned by or directed to the trust upon the death of the decedent. If an asset is not owned by the trust and that asset is a “probate asset” then the deceased’s loved ones will be faced with both a probate administration and a trust administration.
So, putting these ideas together, if the decedent died leaving all non-probate assets (and no debts), then there will not be a need to administer the estate and go through a probate process. If the decedent died leaving all trust assets, there may be trust administration to pursue. If the decedent died leaving any probate assets there will likely be a probate process, but that process can take many different forms. Because every set of circumstances is different, it may be helpful to contact an attorney in order to assess your individual situation.