Texas Probate

[twaddle]

Death: avoid it if you can.

Anybody experienced in the art of independent administration of an intestate estate in the state of Texas?

I'm looking for tips and tricks.

 

[Texas Proud]

More info needed....

big or small

lots of people or only you

if lots... get along or not

lots of hard assets or liquid

taxes due


The great thing about an independent estate is you just file with the court, give an inventory and you are done with that... file a death tax return and final 1040.. now, it is just following what the will says... (well, there is those pesky IRS agents if you owe money)

 

[twaddle]

No will (intestate), 7 figures, by TX probate law there should only be one beneficiary, but we haven't kicked off the heirship determination yet.

In theory, the administrator's duties sound simple: inventory, pay bills, distribute assets.

But what are the tricks of discovering all the assets and debts? Start with a credit report and search county records of every prior state of residence for possible assets?

Does one simply say "Bank teller, did X have a safe deposit box here? Yes? Could you open it please?" Or will I need a court order?

How friendly and cooperative are banks and brokers when you flash your Independent Administrator badge?

 

[2B]

twaddle,

Obviously, you and the deceased were not plugged in very well financially prior to the event. With a seven figure estate, you will benefit by consulting with an estate attorney. They do what you are looking at doing on a regular basis. If there are issues later with other heirs or creditors, having an attorney at least makes it look like you were using good judgement.

The estate pays for the cost; and if it is as simple as what you say, the cost should be safely under $5,000. That could go up if there is a bunch of "real property" that needs to have the title transferred. If you are in Houston, PM me and I'll give you the name of someone that has helped me.

DW and I discovered a few things by carefully watching the mail of her parents. They're not dead but we had them moved into nursing and assisted living. They didn't share crap about their finances with my DW so we had a bit of a treasure hunt. We found next to nothing but there were a few small accounts that we eventually got quarterly statements for.

Definitely pull a credit report. It will have all the formal creditors but not deals with individuals. As for rouge safe deposit boxes, good luck. I don't see how you can hit more than a few banks. I hope they lived in a very small town and didn't travel much. If you can get their bank records, any real property in other states will have had property taxes paid on them and/or rent checks deposited.

The process in Texas is very smooth unless heirs start battling the estate. Then the local probate court drains all the assets with appointed lawyers that contributed to the probate court judge's campaign fund or worse.

 

[Texas Proud]

Sorry.. brain dead when I wrote... missed intestate...

I am surprised you can do independent without a will... I thought one of the requirements is it being stated in the will to be independent..

You will need you letter of Testi.... whatever its called... for each bank. These are court orders that say you are the executor (administrator without will It has been over 20 years since I did this stuff)... The bank are used to this stuff.... As mentioned.. looked for bank, broker statements coming in the mail... most of the time people open up safe deposit boxes in their own bank... so that should help... (of course, my dad got 'free' boxes at some places but did not have an account there anymore.... all we had was a key with no bank name on it.... yea... walk into a bank and ask... will this key fit)..

I also thought that if an estate was a certain size.... you needed a lawyer to file for the estate. This is the 'keep a lawyer employed' act... If there is not a lot to do, it is best that you go by the hour... some want to charge a percent of the estate (I have heard as high as 5%)...

Also... be careful with bene... if you are the only child, then no problem... but with a large estate... people come out of the woodwork to get a piece... I have a friend who's dad got divorced from his mom... lived with a woman and had a couple more kids, but did not get married... when he died (and it was a small estate), the girlfriend wanted a piece and she wanted pieces for her kids.... and got some....

Good luck.... and also, sorry for your loss...

 

[2B]

I also thought that if an estate was a certain size.... you needed a lawyer to file for the estate. This is the 'keep a lawyer employed' act... If there is not a lot to do, it is best that you go by the hour... some want to charge a percent of the estate (I have heard as high as 5%)...

You aren't required to have a lawyer in Texas; but unless it is a very small estate, it is money well spent. Being "intestate" makes it a certainty that I'd get a lawyer ASAP. There's too much liability hanging out there.

I also think that Texas did away with "% of estate" fee arrangements but I certainly could be wrong. When I talked with the lawyer, he gave me some things to do to minimize any fees so the "% of estate" wouldn't have been on the table. If I set things up right, my MIL's death won't be probated at all because on paper everything she owns will pass "jt tent w/rts of survivorship." There is no real property in her name. My FIL will be minimal since we've already sold the house that was in his name.

 

[Martha]

No will (intestate), 7 figures, by TX probate law there should only be one beneficiary, but we haven't kicked off the heirship determination yet.

In theory, the administrator's duties sound simple: inventory, pay bills, distribute assets.

But what are the tricks of discovering all the assets and debts? Start with a credit report and search county records of every prior state of residence for possible assets?

Does one simply say "Bank teller, did X have a safe deposit box here? Yes? Could you open it please?" Or will I need a court order?

How friendly and cooperative are banks and brokers when you flash your Independent Administrator badge?

No knowledge of Texas, but.. . Look at copies of old tax returns--that will help you know where some assets are. Change deceased address to address of PR. Sometimes in some places, once the post office knows someone is deceased they automatically stamp mail as "deceased" and return it to sender. This is a PITA. Search home for brokerage statements, bank statements, life insurance policies, hazard insurance policies and safe deposit box keys.

The letters testamentary or letters of administration that Texas Proud mentioned will open doors you need opened.

You also can search for unclaimed assets through various web sites. Though it does seem to take a long time for assets to be sent to the state as unclaimed.

Searching for real estate owned is tough to do other than checking county records for real estate where the deceased paid property taxes.

 

[utrecht]

I have nothing to add to this thread except to say that my mother currently has a probate case that has gone all the way to the Texas Supreme Court. Its been going on for 2 years now and the Supreme Court is considering hearing the case which my mother has won at every stage up to this point. What a royal pain in the a$$

 

[twaddle]

Excellent info -- thanks!

We have a lawyer, and yes, intestate estates are often associated with nasty dependent administration (I've read the horor stories), but this one should be simple enough that we'll be able to petition for independent administration.

At this point, I'm trying to decide if I really want to accept the independent administrator's duties or farm it out. Sounds pretty painless.

A few more:

What happens if assets are discovered after probate closes? Do the powers of the independent administrator persist indefinitely (via letter of testamentary, I suppose)?

What level of detail is customary for the inventory of tangible personal property? I'm under the impression that I can just lump a bunch of stuff under "household goods." No valuation required? And I assume that the administrator does not have to hold an estate sale unless liquidity is required for debts or distribution -- is that right?

Finally, what's the potential liability of the administrator and is there liability insurance available for such a gig?

 

[cute fuzzy bunny]

Anybody experienced in the art of independent administration of an intestate estate in the state of Texas?

No, but I'm quite sure you cant say the above statement very quickly five times in a row without screwing it up.

 

[2B]

What happens if assets are discovered after probate closes? Do the powers of the independent administrator persist indefinitely (via letter of testamentary, I suppose)?

These are questions for your lawyer. I'll throw in my 2 cents.

Theoretically, I believe that if something is discovered after probate you would have to file a petition to reopen the probate.

What level of detail is customary for the inventory of tangible personal property? I'm under the impression that I can just lump a bunch of stuff under "household goods." No valuation required? And I assume that the administrator does not have to hold an estate sale unless liquidity is required for debts or distribution -- is that right?

Here it comes down to asking if anyone is going to complaim if you take something that they might consider valuable. If there is only one heir, you have a pretty wide latitude unless the Feds want estate tax. If that comes into play you should think IRS documentation.

We had an estate sale that got rid of the mass of crap my in-laws had that no one in the family wanted. I recommend doing that ASAP. Their are professional estate sale people and I also recommend you finding some. They are worth their cost.

Finally, what's the potential liability of the administrator and is there liability insurance available for such a gig?

The liability is there if someone wants to come after you. They do need to have a credible claim on the estate as either an heir or creditor. If you deal through a lawyer, you are covering yourself pretty well but you are never completely safe.

 

[twaddle]

These are questions for your lawyer. I'll throw in my 2 cents.

Thanks -- I'll take the 2 cents. I figure every buck spent by the estate is a buck spent by the heir, and estate lawyers aren't cheap.

In fact, I'm kicking myself for not becoming an estate lawyer. What a beautiful gig! Ever-growing client base. Most of the clients are rich and estate-law naive. And you get to repeatedly dip your fingers into estate cookie jars, which most clients view as "found money." Sweeet!

 

[Texas Proud]

Hmmm.... my father died 28 years ago... and we never 'closed' his probate..

I know the laws have changed a lot since then with small estates, but I don't know what you have to present if the accounts go without probate... again, best to spend a few dollars with a lawyer and ask all these questions... If you need more than just consultations.. then spend it...

IMO, these types of things need professionals and are usually worth the money spent... that is if you control the process...

As a 'side bar' to all..... get a will. They are CHEAP and protect your benes a lot.. and then YOU decide what happens to your assets instead of the state...

 

[Martha]

Thanks -- I'll take the 2 cents. I figure every buck spent by the estate is a buck spent by the heir, and estate lawyers aren't cheap.

In fact, I'm kicking myself for not becoming an estate lawyer. What a beautiful gig! Ever-growing client base. Most of the clients are rich and estate-law naive. And you get to repeatedly dip your fingers into estate cookie jars, which most clients view as "found money." Sweeet!

Good estate and succession planning lawyers have to keep up on a huge body of law. In the business law world they are some of the lowest earners. This is because other business lawyers get paid from business assets and the expense is deductible, but estate lawyers have to be paid by the individual out of the individual's own pocket. And that individual sees little personal benefit from estate planning, most of the benefit goes to heirs. Also, people don't like to think about death and incapacity. So, there is a lot of foot dragging. I read an article recently about some estate planners getting forced out of their big shot NYC law firms because they were not high enough earners.

On the probate end you don't make much money either unless you are in one of those disappearing states where you can charge a percentage of the probate assets. Most of the probate work is done by paralegals.

 

[twaddle]

I happily pay for the lawyer's time when deep knowledge is required. I'm less happy to pay high rates for boiler-plate FAQ sort of stuff that every client should be provided as a backgrounder.

And I occassionally get ticked off when charged $60 for a 2-minute phone call asking him why the consulting lawyer is taking 2 months to answer the question he couldn't answer....

 

[Martha]

Use lawyers with very experienced paralegals and get the paralegal's phone number.

BTW, in some states if assets show up later the personal representative still has power to deal with the asset. Don't know about Texas.

 

[volga]

Heres what one needs to know:

Probate Code

Let's begin with what probate is: It is the presentation of a deceased person's will to the court system for official recognition and registration. The court then determines if the will is genuine so that it may be used in the administration of the deceased person's estate.
Probate in Texas can be simple. Using Independent Administration, the executor of the deceased person's estate may be able to probate the will with only one court appearance and the later filing of the Inventory, Appraisement and List of Claims.
What follows is not intended to provide you with legal advice.

First, what is an Independent Administration?
Independent Administration is used by the executor named in the deceased person's will. The executor is the deceased person's personal representative and is empowered by the court to take whatever action is necessary to settle the estate without having to ask the court for permission every step of the way. The executor's job is to gather the assets, pay appropriate debts, and distribute what's left to the beneficiaries named in the will.
Second, an Inventory & Appraisement and List of Claims must be created.
In the simplest probate, this list is easily created. This document is comprised of assets belonging to the deceased. The court does not require the listing of every single item, but a general list as to the extent of the deceased's estate. Assets usually listed include: real estate, bank account amounts, claims - money due the estate, and personal items. The personal items are generally noted as one number on the list. Using Independent Administration, the executor presents this list to the court, and if approved, the probate proceedings are finished.

 

[twaddle]

I reserved a copy of Nolo's Executor's Guide at the library. I'll see how well it helps with realty in the coming months.

If somebody had to inventory all the crap I owned without my help, they'd have an interesting treasure hunt ahead of them. Would they find the safe depost box, the off-site storage, the partnership interest in a buddy's dot-com, the $5000 loan to another buddy?

 

[Martha]

That is why we made a list, put it in an "in case we die" envelope, and gave it to a friend.

Time for an update.