The Four Texas Probate Choices When Someone Dies Without A Will

Since more than half of all Americans never create a Will or estate plan, there is a strong chance you may one day have to help manage this type of estate. Fortunately, Texas provides four viable approaches for handling such matters — each with its own separate requirements and possible disadvantages. They are described below to make it easier for you to discuss your options with your lawyer.

Two approaches to handling an estate after someone died without a Will involve simply filing affidavits. The other two options include having a probate court help determine the official heirs of the person who died – or the formal filing (or request) for either a dependent or independent administration of the estate.

The four ways you can probate a Texas estate when there was no Will or estate plan

I. You might be able to file a Small Estate Affidavit.

   Requirements for taking this approach – if the estate qualifies for it

  • The estate’s assets, minus the homestead and exempt property, must have a total value of $75,000 or less.
  • This affidavit can only be used to transfer title to a house that qualifies as a homestead. If other pieces of real estate are involved that require transfer, then this type of probate affidavit cannot be used.

Potential disadvantages of filing a small estate affidavit

  • At least two witnesses and all distributees of the estate must sign this affidavit. Since each person who signs the affidavit can later be held financially liable for all future transfers or payments made relying upon it, potential witnesses (and other signatories) are often unwilling to assume such a large degree of financial responsibility.
  • This approach cannot be used if the estate has any debts requiring payment. Since a court does not name a personal representative to handle all the estate’s assets and debts, there is no one eligible to handle the payment of debts.

II.  You might be able to file an Affidavit of Heirship    

     Requirements for taking this approach

     While it is not a strict requirement, this option is usually chosen when the only assets of the deceased that require title transfers are pieces of real estate.

     Drawbacks to using an Affidavit of Heirship?

  • Although some financial institutions will allow the transfer of title to other types of (non-real estate) assets under this type of affidavit, that final decision can only be made by that outside entity.
  • No personal representative is appointed in this type of proceeding. Therefore, if the estate involved has debts, no one is authorized to collect all the assets together and then pay the debts.
  • All title companies do not accept Affidavits of Heirship. Furthermore, some of these companies may only accept this type of affidavit after two (or more) years have passed since it was signed.

The main or “qualified” advantage of this approach is that it costs less than the following two ways of managing an estate after someone dies without a Will in Texas.

III.  You can ask a probate court to make a formal Determination of Heirship    

      This option is designed to firmly establish the distribution of assets to all proper or legal heirs, under the Texas probate code’s intestacy provisions.

      Advantages to taking this more costly approach

  • This choice greatly reduces the chances of fraud that are more likely to occur under the first two options named above since they do not involve any court hearings.
  • An attorney ad litem is appointed by the court. This person has the duty to investigate the decedent’s family history before submitting a formal report to the court (prior to its formal ruling on all the evidence presented).

      Disadvantages to this approach to handling an estate when No Will was found

  • This process is more time-consuming. However, it provides third parties with verifiable evidence that the court had legal grounds for approving the transfer of title during its probate proceedings.
  • It is more costly since at least one court hearing will be scheduled.

IV.  You can request either a Dependent or Independent Administration of the estate

       This approach is chosen when the parties involved want the probate court to appoint a formal administrator of the estate. (The only real difference between a “dependent” or “independent” administration of an estate is the degree of court involvement. The dependent type normally requires more court involvement or direction).

    

      Advantages of dependent or independent administration of an estate

  • The court will appoint a personal representative and provide that person with formal letters of administration, granting that person the right to handle all negotiations with third parties regarding the estate’s assets.
  • Third parties are more likely to quickly provide all required documentation and data requested by the appointed representative, helping to streamline the probate process.

     Two possible drawbacks to this approach

  • It is more expensive. While this is usually the most costly way to handle the estate of someone who has died without a Will, it can prove quite wise in the long run –since all matters will be carefully monitored by the court (even when handled by an “independent” administrator). This lowers the chances of a future need to return to court due to challenges based on fraud.
  • It can prove to be more time-consuming. However, many people who can afford this approach consider it a very valid trade-off compared to only using affidavits that may not be acceptable to all parties.

Please don’t hesitate to contact one of our Murray Lobb attorneys when you need help managing the estate of someone else. Our firm has extensive probate and estate planning experience that allows us to provide you with fully trustworthy legal advice.

Key Facts About Obtaining Texas Guardianship Rights

People of all ages can benefit from creating a legal guardianship relationship, especially young children and disabled adults. When someone suffers major injuries in a car accident or becomes seriously ill, they often need a trusted individual to step in and manage critical matters for them. Your lawyer can draft this type of document as part of your overall estate plan.

It is important to keep in mind that guardianship status may be either temporary or permanent, depending on the circumstances. Both young children and seriously ill adults may sometimes need a long-term guardian.

Exactly how is a legal guardianship created in Texas?
This legal relationship develops after court documents are filed indicating that someone referred to as a “ward” (who is “incapacitated” by age or physical disability) needs a person appointed by the court to properly manage his/her healthcare needs or financial affairs. The person appointed to care for the ward is referred to as the “guardian.”

What follows is a closer look at the four types of guardianships available in Texas and the categories of people often designated as guardians of children or adults. The key responsibilities these court-appointed parties must often handle are also detailed – along with alternatives to naming a guardian.

A closer look at the four guardianships currently available in Texas:

  • Temporary/Emergency Guardianship. This type of appointment is made while the court

reviews all available facts to decide who should hold this position on a more permanent or ongoing basis in the future.

  • Guardian of the person and the estate. The person assigned this role must be prepared to manage all the physical care needs and property of the designated ward.
  • Guardian of the person, limited or full – this person will be responsible for handling all the daily needs their ward might have involving food, clothing, medical care, housing, and other basic requirements.
  • Guardian of the estate, limited or full. This guardian only needs to be concerned with managing a ward’s financial affairs and property.

Who is most likely to be appointed as the guardian of a child or adult ward in Texas?

When the ward is a child, the adults most likely to be granted guardianship are named below, in the order they are likely to be considered.

  • The parents
  • An adult designated as the guardian by the last surviving parent
  • Grandparents or aunts/uncles
  • A non-relative who the court believes can competently serve as the child’s guardian

When the ward is an adult, the people named below may be granted guardianship — in the order they are likely to be considered.

  • The person selected by the ward — who made the designation prior to becoming incapacitated.
  • The spouse of the ward.
  • A non-relative adult who the court decides can serve as a competent guardian.

What duties and tasks must a guardian be prepared to handle in Texas?

  • A guardian may need to post a bond with the court to guarantee that s/he will properly handle all appropriate responsibilities and duties. This bond will be treated like an insurance policy to protect the ward’s property and assets — should the guardian act inappropriately and cause financial losses to the ward’s estate.
  • A Texas guardian must be prepared to make all decisions regarding assets in the best interest of the ward. In other words, there must be no self-dealing or improper gain or profit for the guardian.
  • An appointed guardian should try to provide the best quality of goods appropriate to meet all the ward’s daily needs for food, shelter, clothing, medical care, education, and other requirements.
  • Every guardian must be prepared to file an annual account with the court.  In this document, the guardian must specifically list all the purchases and disbursements made during the prior year — using specified funds on behalf of the ward.
  • An annual inventory must be provided to the court, listing all the ward’s current assets.
  • When a ward has special or unique needs come up, it is always wise for a guardian to obtain the court’s permission to purchase the necessary goods or services – unless they pertain to immediate medical needs.

How can these same kinds of needs be met in Texas without obtaining a guardianship?

It may be necessary for your Houston estate planning attorney to create one or more of the following documents to take the place of designating an appointed guardian in this state.

  • You may need to have a Medical Power of Attorney document drafted for you, in keeping with Chapter 166 of the Texas Health & Safety Code.
  • You may want your lawyer to prepare a management trust, in keeping with the terms found in Chapter 1301 of the Texas Estates Code.
  • It may be necessary for your lawyer to create a special needs trust for you.
  • You may want your lawyer to draft a Durable Power of Attorney document that will name or appoint an attorney-in-fact or agent for you.
  • It may help to create a joint bank account for you and a trusted family member.

While the list above is not intended to be comprehensive, it should indicate that there are many other ways to meet the many needs covered by the appointment of a Texas guardian

Please feel free to contact one of our Murray Lobb attorneys so we can answer all of your questions about your estate planning needs. Our firm is also available to provide you with legal advice regarding many other general business topics — and to draft a wide variety of contracts and other documents you need to transact business daily

Creating Final, End-of-Life Instructions to Help Your Spouse

Regardless of whether you’re doing this for your spouse or another family member, it’s important to leave clear instructions on how you want your funeral and final financial matters handled. Since some of these issues can directly impact your heirs and beneficiaries, it’s best to meet with your lawyer so that every important topic is carefully addressed.

Prior to meeting with your Houston estate planning attorney, please gather together and review all the documents related to the topics referenced below. Once you arrive at your legal appointment, you and your lawyer can then discuss each of these topics in greater detail. The suggestions shared below are mainly based on ABA (American Bar Association) materials and a few online resources.

Addressing these financial matters can lessen your spouse’s (or executor’s) burdens

  • Pre-pay the costs of your burial/cremation – if you can afford to do so. Whenever possible, choose the simplest arrangements. You might want to note, in writing, that your surviving family members don’t need to prove their love by spending lavishly on either a funeral or memorial service. If you cannot pre-pay for everything, you should also address the topics noted in the next paragraph.

As your lawyer will remind you, funeral directors are normally required to provide you with a printed copy of all their costs. These lists can be useful for price-shopping. Also, warn your survivors to avoid letting funeral parlor employees who use guilt-inducing tactics. And if you’ve selected cremation, be sure that all costs involved are provided to your spouse ahead of time. Far too often, “hidden” costs are added later.

  • Create some type of emergency fund. Survivors often need extra money to cover unexpected last expenses If you haven’t converted a bank account to a POD (payable on death) status, do so now. Your lawyer can explain how this works in greater detail. Explain where such funds are being held in your letter of final instructions. While insurance policies usually pay off quickly to most beneficiaries, odd events can delay this process.
  • Make a list of all outstanding debts you know about, including all credit card accounts. Be sure to attach a list of all your assets and their present value. Also, state where all your banking and investment accounts are located, along with any IRAs.
  • Indicate where all important personal and family documents are kept, including your Will. Be sure to include all family birth certificates, your marriage license, any divorce decrees, adoption papers – or any prenuptial agreement. Likewise, note where you’ve put all insurance policies, business, bank and financial records – and 401k documents. Copies of all current pension and/or other benefit agreements should also be noted and their locations described.

And don’t forget to note where any house deeds, car titles or paperwork regarding vehicles still being paid off are located.

  • Ask your lawyer to help you create a “precatory” list of personal items. Stated simply, this is a list of personal possessions that you name and set aside for specific family members or others. These usually only have sentimental (and not financial) value.

While a precatory list isn’t often legally binding, it can help prevent dishonest family members from keeping all special keepsakes for themselves. As a recent AARP article noted, many families include individuals who are intent on defrauding everyone out of their fair share of cherished belongings – or any inheritance.

  • Be sure this final letter of instructions states how all your business interests and artistic property are to be handled. If you’re still a co-owner in a business, this may already be dictated by a contractual agreement. Take the time to review this document with your lawyer, so you can accurately state in your letter what business or control options might survive you. It’s always best to resolve such matters in writing, well before your death.

If you’re a celebrated artist of any kind, you should make proper arrangements for specific people – or perhaps an institution like an academic library or museum — to take formal possession, ownership and control of your artwork. This must be done in full keeping with all applicable copyright laws. (Try to fully explain these rights to your intended beneficiaries, long before you pass away).

Additional instructions (recommended by the American Bar Association)

The ABA suggests keeping a copy of your letter of final instructions with your Will and giving a copy of it to your lawyer. Be sure to ask your attorney to provide a copy of this letter to your surviving spouse (or other family members) immediately upon your death – in case they have lost their copy.

  • Note any specific information you want included in your obituary. This can include the naming of a charity you would like to have people give money to on your behalf. You can also ask that this money be given directly to your church or other house of worship.
  • Note where your safe deposit box is and place the key to it in the envelope with the letter, noting that it’s in there. You should also list your lawyer’s name and phone number, as well as the name and phone number of your executor.
  • Your current social security card and copies of all insurance policies. State where these are currently kept. Also, let your spouse or executor know if there may be a need for your family to renegotiate any aspect of their medical insurance coverage with your most recent employer after your death.
  • Contact information for key individuals. Create and attach a complete list setting forth the names, current addresses and phone numbers of all beneficiaries named in your estate documents, 401k plan and insurance policies.
  • Note the location of the last seven years of your tax returns.
  • Grief counseling advice. You might want to leave the specific name of a clinic or its therapists who might be able to offer counseling to your spouse. You can also suggest that your spouse check with the AARP to see whether that group currently sponsors any local support groups for recent widows/widowers.

Please feel free to schedule an appointment with one of our Murray Lobb attorneys so we can help you draft a final letter of instructions for your spouse, another relative — or your executor.

Estate Planning: Becoming a Texas Organ and Tissue Donor

If you’ve ever known someone waiting to receive an organ, you know how stressful the process can be. Most of those requesting help are either fighting to save their lives or to greatly improve their health. Fortunately, there’s a national transplant waiting list that’s been set up to match donors and recipients in Texas and all other states.

Since many people want to help with this critical need, they often ask their lawyers how they can become donors. This article will describe what you should do — besides simply indicating this desire on your Texas driver’s license.

A few statistics are set forth below to help those trying to decide if they’re ready to help others in this way, followed a description of the other steps you should take to be sure your decision to become a donor is faithfully honored in the future.

How many people’s lives are at stake annually due to the need for organ donation?

  • About 20 Americans die each day due to the lack of available organs
  • Since 1988, about 700,000 transplants have been performed in this country
  • Nearly every 10 minutes, a new name is added to the donor recipient list
  • It only takes one donor to save as many as eight lives. In fact, one donor can improve the quality of life for over 100 individuals – just by making extensive tissue donations
  • The most commonly transplanted tissue is the cornea of the eye
  • Roughly 6,000 living donations are made each year. And one-fourth of the donors are not family members or biologically related to the person in need.
  • About 1 in every 26 Americans has a kidney disease without knowing it – that equals about twenty-six million people who might one day require a transplant.

Living donors are also needed. Healthy people can donate part (or all) of a kidney, liver, intestine or lung. Sick patients are also in need of bone marrow and blood from healthy donors.

How do most Texans handle this decision to donate tissue or organs?

States like Texas have tried to simplify this process by allowing those wishing to donate their organs or tissues (in the future) to indicate that on their Texas driver licenses. Residents of the state can also have their Houston estate planning attorney directly state this commitment in their Medical Power of Attorney or Advance Directive. This latter approach can help remove the anxiety from the shoulders of family members once this information has been legally documented in this manner.

The third way people can indicate their desire to be organ donors is to directly sign up with DonateLifeTexas.org . You can learn more about this process by watching the following video created by DonateLifeTexas.org .

Please feel free to contact any of our Murray Lobb attorneys so we can meet all your business and estate planning needs. We look forward to sharing our legal skills and advice with you.

Key Estate Planning Advice for the Terminally Ill

Nearly everyone expects to live to their full life expectancy. However, as we grow older, we begin to see many friends and loved ones die early due to cancer, heart disease or various tragic, unexpected events. For this reason, every adult should create an estate plan and remain ready to modify it once a terminal illness or tragedy suddenly unfolds.

After all, our family members, friends and favorite charities depend on us to maximize the gifts we make through our Wills, trusts and other testamentary devices.

To get ready for this process, you should first make a list of all your current assets (and their values) and then schedule an appointment with your Houston estate planning attorney. When you meet, your lawyer can explain the choices you’ll need to make that can simplify the process, while also decreasing the tax burdens on your heirs and other beneficiaries.

Here’s a look at some of the ways that terminally ill people – or those aware that the end of life is fast approaching – can adjust their estate plans to maximize the final gifts they can give to all those they wish to help.

Specific steps for the terminally ill to consider while updating or creating an estate plan

  • Decide if you should set up a revocable trust. This can help greatly reduce all the tasks the appointed executor must handle — and can lessen the chances that any of your estate will have to pass through the probate process.
  • If you’re a parent or grandparent, consider creating a private annuity. This will allow you to transfer substantial assets to your loved ones while retaining a lifetime annuity. If you do not live to your expected lifetime expectancy, as set forth in actuarial tables maintained by the IRS, most (or all) of your assets may not be taxed.
  • Make sure you’ve fully used up all your current annual exclusions. As many taxpayers know, every American has the right to give $12,000 a year to multiple donees. And if your spouse agrees to all the gifts you’d like to make during the current tax year, you could give away a total of $288,000 — tax free. It’s also possible that other “leveraging” techniques involving family partnerships could greatly increase that amount.
  • Check to see if all your assets are titled properly (so your beneficiaries will reap the best tax benefits). Your lawyer can explain how this can help you obtain the full lifetime exemption from estate taxes. In some cases, it may be best if many assets (including the highly appreciated ones) are held in the name of the terminally ill spouse. When this is allowed, it can help minimize all the capital gain taxes that might otherwise accrue when various assets are sold after the terminally ill person passes away.
  • Review all the assets held in your 401k and other retirement accounts. This can also help you recall what you’ve already bequeathed to various beneficiaries. Be sure to bring all the updated information about these accounts to the meeting.
  • Create an update list of all named beneficiaries and their current addresses. Everyone will appreciate being able to receive your gifts as quickly as possible.
  • Consider placing a certain amount of cash in your checking or savings account so that your executor can easily pay your final expenses using that money.

If you’re the terminally ill patient, seriously consider asking your spouse, executor, other trusted family member or close friend to take part in this meeting with your attorney. This can help you avoid forgetting important assets and beneficiaries. It can also remind you to tell this trusted person where you currently keep all your real estate deeds, the passbooks for all your investment and saving accounts — and all your online account usernames and passwords.

While the information above isn’t intended to be fully comprehensive, it should provide you with an accurate idea of the types of matters you and your lawyer can handle during your upcoming appointment.

Finally, please be aware that your attorney may be able to arrange an initial, teleconferencing appointment if that will work best due to your serious illness. Finalized paperwork can then be signed within a short timeframe.

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Please feel free to contact your Murray Lobb attorneys for help with any of your estate planning or general business needs. We try to remain available to provide you with prompt legal advice and the various contracts and other documents that help keep your business running.

Inter Vivos Gifts: Transferring Property or Wealth While You’re Still Alive

Stated simply, inter vivos gifts are those given by a donor to a beneficiary during the donor’s lifetime. Many families and individuals enjoy passing property or wealth on to loved ones, friends or charities in this manner. The term “inter vivos” is a Latin one that can be translated as “between living people.”

One of the chief reasons a donor makes this kind of gift is to help a beneficiary avoid paying unnecessary probate taxes after the donor passes away. Another motivation is to give the donor the personal pleasure of seeing the beneficiary enjoy the gift or funds. While other reasons may exist, those are among the most common ones.

The following material reviews some key legal terms you’ll want to know while working with your Houston estate planning attorney. There’s also a list of key factors required for a valid transfer of an inter vivos gift.

Legal terms often used when conveying wealth or property as inter vivos gifts 

  • Donor/grantor. Both these terms are used to describe the person making the inter vivos gift;
  • Beneficiary. The party designated as the recipient of the funds or property;
  • Settlor.  This term is often just used to refer to someone who creates a trust;
  • Advancement. When making a formal inter vivos gift, you should tell your lawyer if you want to treat a gift as an “advancement” against future gifts you’ve already designated for a beneficiary in your estate plan. That will mean that the value of the current gift will reduce the size or value of your later bequest to the specific beneficiary.  You can also just state that you do not want your current, inter vivos gift treated as an advancement against what you’ve designated for a person or group in your estate plan; 
  • Capital gains taxes. Keep in mind the tax consequences that can occur if you currently give someone an inter vivos gift like stock shares. For example, if you give someone an inter vivos gift of stock shares that originally cost you less than $3,000 – but are now worth over $10,000 — your beneficiary will likely have to pay a capital gains tax on that gift. To prevent this burden from being passed on to a beneficiary, you may just want to give the person cash to buy stock shares — or anything else they prefer;
  • Gift taxes. At present, every beneficiary who receives an inter vivos gift worth more than $15,000 must pay a gift tax on the amount to the IRS. Therefore, most people who give these gifts keep them under $15,000 for each recipient. You’ll need to ask your attorney what the limits are on the size of the inter vivos gifts that spouses may want to give each other.

Choosing to create a trust when transferring wealth as an inter vivos gift

Some grantors may not want to make direct cash or property gifts. Instead, they make want to make this type of gift by creating either a revocable or irrevocable trust. As may now be clear, these types of trusts take effect while the settlor is still alive. In contrast, testamentary trusts don’t take effect until the settlor dies.

Here’s additional information about both revocable and irrevocable inter vivos trusts.

  • The revocable inter vivos trust. This can go into effect (or become operative) during the settlor’s own lifetime. This type of trust can also be referred to as a living trust – one that is drafted so that it won’t have to go through the probate process;
  • The irrevocable inter vivos trust. This type of conveyance is designed to go into effect while the settlor is still alive. However, it cannot be revoked after the settlor has finalized it. People normally use this type of trust to help reduce the beneficiary’s potential tax debt.

Key information about making inter vivos gifts to minors

Since minors cannot receive large gifts of money or property directly, inter vivos gifts made to them require the use of a trust. A party must be named as the guardian of the trust to manage its contents (under court supervision) on behalf of the child – until s/he reaches the age of majority.

Conditions that must be met for a valid inter vivos gift to be made

  • The donor must have capacity. As a donor, you must be at least 18 years old when you make this type of gift;
  • The donor must have the proper intent. This requirement usually means that the donor intends for the gift to be transferred during his/her lifetime;
  • Receipt of the gift by the beneficiary. You must arrange a reliable form of delivery to the beneficiary. This means the donor/grantor (or settlor) will then no longer have control over the funds or other property;
  • Acceptance. The beneficiary must accept the gift. While most of us would readily accept an inter vivos from someone else – that’s not going to be true of everyone. In some cases, high taxes might be due on the gift — or the recipient may simply not want to accept any gift from the grantor or settlor.

Please feel free to contact one of our Murray Lobb attorneys with any questions you may have about making legal gifts to others for current delivery – or to be received later as part of your personal estate plan.

Handling Your Adult Child’s Estate in Texas

Losing a child of any age remains one of life’s most difficult challenges. When that child is an adult, you may often need legal advice on how to manage any estate left behind, even if it’s rather limited. Now that so many Americans are living well into their 70s and 80s, the chances of losing an adult child are growing.

One study found that 11.5 percent of people age 50 or older have lost at least one adult child. That likelihood of loss is even higher for African Americans – 16.7 percent of them have lost an adult child. Furthermore, the older you get, the sense of loss can be even harder to cope with since adult children are often the closest caregivers of their aging parents.

Here’s a look at some of the legal questions you’ll need to address after losing an adult child.

Issues Surviving Parents May Need to Face After an Adult Child Passes Away:

  • Did your son or daughter live with and leave behind a spouse or partner? If so, calmly reach out to that person to find out if there’s a Will naming the personal representative of the estate. If your child didn’t have a Will or named someone else as the executor of their Will, you’ll need to interact very sensitively with that person. When you contact your Houston estate planning lawyer, be prepared to indicate your adult child’s marital status at the time of death;
  • Did your adult child have any children? It’s important to stay on good terms with your loved one’s surviving spouse or partner since visitation rights and overall family harmony may depend upon your relationship with that person. (Note: If the surviving spouse or partner has any major substance abuse problems, be sure to share that information with your lawyer. We can explain pertinent child custody and adoption laws, if necessary);
  • Did your son or daughter own considerable land or personal property? Your attorney can help you try to prevent anyone from giving away or disposing of such property before the estate can be probated – or passed on according to your adult child’s estate plan. If you’ve been named the personal representative, obtain a copy of the Will as soon as possible. If no one is living in your adult child’s former house or apartment, be sure someone visits soon to look for pets needing immediate care, valuables that must be secured and vehicles that must be locked and placed in a garage;
  • Contacting your adult child’s employer. If you were named as your adult child’s personal representative, you’ll soon need to contact that employer to find out what employee assets may still be held in a 401k or other account. Likewise, you’ll want to find out if any other benefits are still owing to your child – and if s/he held any type of insurance policy through the employer;
  • What should you do about burial, cremation and related issues? Always try to honor the instructions in your deceased child’s Will or other legal documents. If you can’t find a Will, then work with any surviving spouse/partner and other family members to handle this matter in keeping with your family’s faith practices or general traditions;
  • Do you know what to expect under Texas law if your adult child died intestate – without a Will or some other type of estate plan?  Your Houston estate planning attorney can explain how Texas courts address this type of situation. We can also inform you about how estates are handled by probate courts and how you should manage other tasks that are often required after losing an adult child.

Please know that since our firm has worked with many clients grieving over the loss of loved ones. We’ll provide our legal advice in the most caring manner possible. When you contact one of our Murray Lobb attorneys, we’ll be ready to provide you with simple steps to take so you can concentrate on obtaining comfort from family and friends.

Probating the Texas Estate of a Missing Person

At first glance, it might seem impossible to probate the estate of someone who is missing and presumed dead. However, the Texas Estates Code provides for this very process under Title 2, Subtitle J, Chapter 454 entitled, “Administration of Estate of Person Presumed Dead.”

That chapter clearly states that a probate court has the required jurisdiction to determine the likelihood of a person’s death when specific steps are followed — even if the main evidence presented is entirely circumstantial. However, the Texas Estates Code was carefully drafted to prevent fraud by requiring a lengthy delay before the assets of these types of estates can be distributed.

What are the main steps usually taken to probate the estate of a missing person?

  • Request for letters testamentary. After the probate process has begun with the filing of a request for letters testamentary, the court-appointed personal representative must serve a citation on the person presumed dead in the manner required by the court. Since the person is missing, this often means publishing a notice of the proceeding in one or more print newspapers – and in any other manner dictated by the court;
  • Contacting the proper authorities. The personal representative must then formally contact the proper authorities about the estate owner’s missing status. Among others, law

enforcement officials and state welfare agencies should be notified – along with any others suggested by the court;

  • A professional investigative agency should be hired. This must be done in keeping with the provisions of  Section 454.003 of the Texas Estates Code (requiring efforts to locate the missing owner of the estate). During this process, the investigator may encounter potential heirs who may have crucial information that can help locate the missing person – or help determine where s/he was living shortly before death.

The investigator should create a report based on all research and interviews conducted and then present it to the court – documenting that the missing person cannot be located. The cost of this investigation is normally reimbursed by the estate, after the court has had time to review the requested fees.

How quickly can the estate be distributed?

Section 454.004 of the Texas Estates Code clearly states that this can only be done after three years have passed since the date on which the letters testamentary were issued by the court to the personal representative.

What personal liabilities can arise if the person presumed dead reappears after distribution?

If the missing person returns and presents conclusive evidence that s/he was alive at the time the

letters testamentary were granted, that individual has the legal right to regain control of the estate — whatever remains of the funds or property.

However, this person who was presumed dead – yet has now reappeared – cannot get his/her property back that was sold for value to a bona fide purchaser. Instead, this person only has the right to the proceeds or funds obtained for the sale of the property to the bona fide purchaser.

In addition, Section 454.052 states that the personal representative who handled all the legal sales transactions for the estate, not knowing that the missing person was actually alive, cannot be held liable for any financial losses suffered by that individual who has now returned. And any surety who issued a bond to that personal representative cannot be held liable for anything the personal representative did while complying with approved court-ordered activities.

Should you need help probating any estate, please feel free to contact one of our Murray Lobb attorneys. We’ve had the opportunity to help many clients and can readily answer all your questions.

Special Estate Planning Concerns for Second Marriages

If you’ve recently married for a second time or are planning to do so, it’s important to meet with your attorney to be sure all your assets will still be properly distributed in the future. Even if you think your new spouse is very trustworthy, you must understand how Texas community property laws may affect all preferred beneficiaries when you pass away one day.

In order to minimize future misunderstandings, many spouses in second marriages enter into property agreements that help balance out the interests of all children from prior marriages – as well as those who might be born into your new one.

Before reviewing some of the basic legal documents your lawyer may need to redraft on your behalf now that you’ve remarried, it will be helpful to note some of the complications that can develop when newlyweds simply assume their current estate plans don’t need to be updated.

Careful planning can help you minimize problems with the future disposition of your estate

  • Suppose you’ve married a much younger new spouse and you have children from your first marriage. What will likely happen to your home and all other possessions upon your death? Sometimes, newlyweds just assume that all will go well once the older spouse dies first – and that older children of the deceased spouse will just wait many years until the new spouse passes dies to inherit the family home and other wealth.

Unfortunately, bitter legal fights can erupt between your adult children and your surviving spouse under this type of scenario. What’s often best is to leave an insurance policy (and possibly other funds) in a trust, so that your children can receive specific amounts of money upon your death – and then other property or wealth years later when your surviving spouse finally passes away;

  • What if your new spouse keeps insisting that if you pass away first, he’ll make sure your kids from an earlier marriage will inherit all that you wish, without stating this in newly executed documents? Can this type of arrangement ever be risky? Yes, it can. It’s always possible that you and your new spouse will experience hard times financially at some point in the future. If that happens, keeping sincere early promises may no longer seem reasonable to a surviving spouse left with only a modest amount of money.

Always update your estate plan when you remarry. And if you and your new spouse hold very different attitudes toward certain financial bequests, go ahead and meet with different attorneys to update your estate plans separately. However, make sure you both understand your responsibilities to your new spouses under the new estate plans (and ask your lawyers to review both plans to be sure they won’t precipitate any crises);

  • Will it cause unnecessary confusion for spouses in a second marriage to hold joint bank accounts in the future to pay certain mutual expenses – without jeopardizing the later disposition of assets when one spouse dies? That arrangement should work out fine, although you should both consider also maintaining separate bank accounts to help you pay expenses tied to all separate properties you brought into the marriage.

Should new spouses carefully revise named beneficiaries in POD and retirement accounts?

The answer to that question is almost always, “Yes.” Be sure to bring information about all accounts you have when meeting with your Houston estate planning attorney. You should also bring copies of any property deeds in which you’re named — and information about any trust accounts you currently have (or may desire). Your attorney will also need to see copies of your current Last Will and Testament, 401k and POD accounts, all retirement accounts and all insurance policies.

If you need any advice about your current estate plan due to an upcoming marriage – or divorce, please contact one of our Murray Lobb attorneys at your convenience. We will look forward to providing you with the documents you’ll need to feel confident and secure about your entire family’s financial future.

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How Texas Estates Are Often Handled When Wills Cannot Be Found

Given how hard most people work to pay their bills and save up for their retirement years, you would think all of us would want to maintain strict control over who will inherit from us. Yet statistics reveal that only about forty percent (40%) of Americans have faced their mortality and asked their lawyers to help them create Wills.

When we make this error, we increase the chances that relatives we don’t know very well – or perhaps even like – may one day receive all our wealth. That’s regrettable since most of us have specific family members who would benefit the most from an inheritance. And great charities and faith-related beneficiaries can always use our funds to bless many others.

Hopefully, this article will help you see the advantages of meeting with your Houston estate planning attorney to create a first Will — and then later update it as your estate grows.

What are the five ways Texas wealth is often distributed when there is no Will?

  1. Under the state’s intestate succession laws. While these are useful, they do not let you determine who will inherit from you. Furthermore, if you own any of the following types of accounts or property, you must make sure that you’ve provided an updated list of beneficiaries to those who maintain these accounts (or other forms of wealth) on your behalf.
  1. Proceeds from a life insurance policy
  2. Retirement account funds that may include a 401k, IRA — or another, similar type of account
  3. Property that you and another person own together
  4. POD or payable-on-death account funds
  5. Property that’s already held in some type of living trust
  1. Through the filing of an Affidavit of Heirship. This approach can normally only be used when the assets requiring a title transfer are real estate. However, you can sometimes use this type of affidavit for non-property assets – depending on the rules of the institution that currently manages those items. Be prepared to discuss this topic in detail with your lawyer since there are certain limitations involved with using this type of affidavit.

For example, some title companies will not accept these types of affidavits when you’re trying to establish a legally valid chain of title for property. In addition, since no personal representative will be appointed, there won’t be anyone who can manage the estate’s assets and pay all required debts. Also, two witnesses must sign this type of affidavit and both are liable for any false statements that may be contained in it.

  1. By filing a Small Estate Affidavit. If your attorney takes this approach, he’ll first have to determine if the estate is solvent and if it’s worth $75,000 or less. In addition, the affidavit can only be used to transfer title to a homestead. Furthermore, there will be no appointed personal representative to collect all the assets, pay all required debts and deal with necessary third parties. Financially responsible witnesses must also sign this type of affidavit.
  1. Using a probate court proceeding called a determination of heirship. The advantages of this approach include having a hearing, the presentation of evidence and a court issuing a judgment accepting or rejecting all submitted affidavits of heirship. However, some relatives eager to settle an estate may find this approach less appealing since it can be rather costly – mainly due to the need to file various pleadings with the probate court. You must also coordinate everything with the court appointed attorney ad litem who will investigate whether there’s any possible fraud regarding the filed affidavits of heirship. However, obtaining a court ruling that specific parties are lawful heirs is very useful;
  1. Handling the matter as either an independent or dependent administration of the estate.

The difference between these two types of administrations is based on the degree to which the probate court must be involved in the proceedings. The term “independent administration” simply means that the court has minimal involvement.

Whichever approach is chosen, there will need to be an appointment of a personal representative who is qualified to receive letters of administration provided by the probate court. These “letters” allow the personal representative to collect all the assets and pay all the debts. The biggest drawback of this approach is that it’s often the most expensive way to handle the estate of someone who died without a Will.

Hopefully, this general information has helped you see that creating a Will is one of the best ways to move forward into a more stable financial future.

Please feel free to contact one of our Murray Lobb lawyers so we can answer any questions you may have about settling someone else’s estate — or drawing up a Will (or full estate plan) of your own. We appreciate the opportunity to help our clients handle these types of matters and look forward to hearing from you soon.