Probate & Trust Administration


What is probate?

The act or process of proving before a duly authorized person (typically a judge), that a Last Will and Testament submitted for official certification and registration is genuine.

Why is it necessary?

Probate is necessary to pass title to property to those person(s) named as beneficiaries in the Decedent’s Will.

How can I avoid probate?

There are several tools that estate planning attorneys recommend to clients that can eliminate the need for probate. However, it is important to know that in Texas we have a very streamlined probate process and it is not the nightmare it can be in some other states.

Trust Administration

What is a trust?

The easiest way to visualize the use of a Living Trust is to invision the Trust as a pick-up truck. It is a “legal entity” which comes into existence after the lawyer drafts the Trust and it is signed by the individual who establishes it (the Trustor) and accepted by the person who will “drive” the Trust (the Trustee). Quite often, while the Trustor is living, he also serves as Trustee of his own Trust. Title to assets must be conveyed into, or placed in the “truck.” At this point, the Trustee is in the driver’s seat, carrying his assets in his name as Trustee. On his death, it is not necessary to stop and probate title to assets “out of the truck,” but rather a Successor Trustee takes over the driver’s seat to continue driving the truck as directed in the Trust. A Living Trust can be revocable or irrevocable.

Testamentary Trusts are trusts that are created in your Last Will and Testament and are not funded until the Will is probated after your death. Probate is necessary in order to transfer title to assets to the Trust.

The American Taxpayer Relief Act of 2012 (H.R. 8) was passed by the United States Congress on January 1, 2013, and was signed into law by President Barack Obama the next day. As it relates to Estate, Gift and GST tax, the $5 million dollar exemption for individual estates ($10 million for couples) remains in place. Note that indexed for inflation, the $5 million dollar exemption is currently $5,250,000. Estates would be taxed at a top rate of 40% (up from 35%). In addition, the exemption amount (for gift, estate and GST taxes) remains unified and is permanently extended after 12/31/12. Portability of the unused credit is also made permanent.

This new law will certainly be something that individuals will want to consider in their Estate Plan and as such will want to visit with their financial, accounting and legal professionals to determine whether any revisions to their planning is necessary in light of this new law.