After losing a loved one, people go through a painful grieving process. To make matters worse, survivors often must go through the probate process, which can be quite challenging itself. Adding litigation on top of all of that makes it even more emotionally and financially draining for even the strongest among us.
So you may wonder if there is a way to avoid this additional pain. And simply put, the best way to avoid probate litigation is to avoid probate altogether by planning ahead and planning smart. There are different options you can use, such as trusts, retitling assets, and alternative probate proceedings. Today, we’ll explore some things you can do if you are interested in avoiding probate in Texas.
How Do You Avoid Probate in Texas?
Probate is the legal process of collecting, valuing, and distributing a person’s assets to their rightful heirs and beneficiaries. If there are no assets titled solely in the deceased person’s name (the decedent), then probate is unnecessary.
So avoiding probate in Texas requires strategic estate planning. The ultimate goal is to avoid holding assets solely in your name, which you can accomplish in several different ways.
Here are some options:
- Revocable living trust;
- Jointly owning assets;
- Payable-on-death (POD) bank accounts; and
- Transfer-on-death (TOD) deeds.
Our estate planning attorneys can review your assets, finances, and goals to determine the best way to structure your estate plan so your heirs can avoid probate.
Revocable Living Trust
A revocable living trust is an estate planning tool that shelters your assets from probate. Once you sign the trust document, you retitle assets into the name of the trust and retain ownership over them. From there, those assets are controlled by the trust terms. Trust assets pass to the trust beneficiaries outside of the probate process.
Jointly Owned Assets
Another method of avoiding probate in Texas is to jointly title your assets. This way, the assets automatically transfer to the co-owner when you pass away and are not subject to probate.
Payable-On-Death (POD) Bank Accounts
Texas recognizes POD designations on bank accounts. With this designation, you still control the money in the account—but at your death, everything goes to the beneficiary you name. This all happens outside of probate.
Much like a POD account, you can transfer a piece of real property, including a house, with a transfer-on-death deed. The deed is recorded while you’re alive, and you remain the property owner during your lifetime.
After you pass away, the transfer-on-death deed goes into effect, and the beneficiary receives ownership of the property without the need to go through any court proceedings.
Alternative Probate Proceedings
In Texas, you can avoid a full probate proceeding with either a Small Estate Affidavit or a Muniment of Title. These are not estate planning tools, but options for your loved ones after you pass away.
Do I Need a Trust to Avoid Probate?
You don’t need a trust, but one common way to avoid probate is with a revocable living trust. You can title your assets into the trust and manage the trust for many years before you pass away. After your death, the named successor trustee takes over and manages the trust per your instructions in the trust document.
We then have years of you managing your assets within the trust to show the probate judge that it is doing exactly what you intend. It is much less likely that you lacked mental capacity or didn’t know what you were doing. That greatly reduces the risk of litigation. The use of a revocable living trust avoids probate altogether because the assets in the trust pass to the beneficiaries without a probate court’s intervention.
Does a Will Avoid Probate in Texas?
If you’ve used a will, the executors pay the attorney’s fees and the filing fees. Anyone who is unhappy with it can simply show up at the hearing and begin a dispute. It triggers a lot of problems and skyrockets the costs.
If you’ve done a trust, on the other hand, it didn’t go to probate court because there is nothing to probate since everything is being privately managed in the trust.
If someone is unhappy and they want to cause a dispute, they have to hire their own probate attorney, pay filing fees, and prove to the judge that they should even get access to see the trust in most cases. A trust is a private document. It usually costs a lot more money and energy to dispute a trust than it does a will.
If we suspect that there might be a dispute coming, I oftentimes advise my clients to nominate a professional trustee like a bank or a professional trust company, because they have a fiduciary duty to defend the trust.
If someone tries to accuse the bank of violating its fiduciary duty, the bank has very good attorneys, who are very good at defending against that scenario early on, which saves time and fees.
WHAT SETS YOU AND YOUR FIRM APART IN HANDLING PROBATE AND PROBATE LITIGATION?
Now that you know how to avoid probate in Texas, why choose The Law Offices of Kyle Robbins, PLLC? I care very deeply about probate clients and I am passionate about taking care of them because it has personally affected my family.
My grandfather left a farm in another state to his children and my mother was appointed the executor. It went terribly and took years to get through the probate process because it was poorly handled by the probate attorney. It really caused a rift in my family.
I knew I could do a better job for families to make sure that they don’t have to go through these things by themselves. A good probate attorney can do a lot to prevent conflict amongst families and get it done quickly, instead of dragging it out.
On top of that, I went to one of the best law schools in the country and I litigate with some of the top attorneys in Austin. I’m very good at what I do and I really enjoy my career.
For more information on Avoiding Probate Litigation In Texas, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (512) 851-1248 today.
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