Probate is the legal process that occurs after someone passes away and their assets are distributed according to their will or Texas law. While it is an important process that ensures that a deceased person’s wishes are carried out and that any outstanding debts and taxes are paid, it can also be a lengthy and expensive process that can cause stress and conflict among loved ones.
Fortunately, there are alternatives to probate that can help avoid the time and expense of the legal process and make it easier for loved ones to distribute a deceased person’s assets. Here are some of the most common probate alternatives:
- Joint ownership: One way to avoid probate is to hold assets in joint ownership with someone else, such as a spouse or adult child. When an asset is held in joint ownership, the surviving joint owner automatically becomes the owner of the asset upon the other person’s death. This means that the asset does not need to go through probate and can be transferred to the surviving joint owner without the need for legal proceedings.
- Payable-on-death (POD) accounts: Many financial institutions offer POD accounts, which allow a person to name a beneficiary to receive the funds in the account upon their death. These accounts do not go through probate and can be transferred to the designated beneficiary quickly and easily.
- Transfer-on-death (TOD) deeds: Similar to POD accounts, TOD deeds allow a person to name a beneficiary to receive their real estate property upon their death. The property does not go through probate and can be transferred to the designated beneficiary without the need for legal proceedings.
- Living trusts: A living trust is a legal document that allows a person to transfer ownership of their assets to a trust while they are still alive. The assets in the trust are then managed by a trustee, who distributes them according to the terms of the trust upon the person’s death. Living trusts do not go through probate and can help avoid the time and expense of the legal process.
- Small estate affidavit: In some cases, a deceased person’s estate may be small enough that it does not need to go through probate. In Texas, for example, if the estate is valued at less than $75,000, a small estate affidavit can be used to transfer the assets to the designated beneficiaries.
While probate is an important legal process that ensures that a deceased person’s wishes are carried out and that any outstanding debts and taxes are paid, it can also be a lengthy and expensive process that can cause stress and conflict among loved ones. By using probate alternatives such as joint ownership, POD accounts, TOD deeds, living trusts, and small estate affidavits, it is possible to avoid the time and expense of the probate process and make it easier for loved ones to distribute a deceased person’s assets. Call Hunter Sargent, PLLC today to talk about probate alternatives and whether they’re right for you.
