The thought of one's estate going through probate is a common concern with those planning how to distribute their assets--and to whom. Texas probate is touted as being one of the easiest to navigate--as long as a well-worded will is in place. But avoiding the state's involvement in the distribution of property to heirs is compelling. If you are making estate plans in the hope to avoid Texas probate court completely, here are the steps to take to achieve that end.
Make sure all assets have "survivorship rights" clearly spelled out. This means that both parties are listed in the wording of the asset--such as a bank account or mutual fund--and that the legal wording of the account clearly states that the asset passes to the survivor in the event of one party's death in Texas.
Verify that assets have "payable-upon-death" or "transfer on death" wording. This would include items such as life insurance, bonds and stocks, or retirement accounts. If this legal wording is not included, discuss with the account's managing firm how to correct the oversight to avoid probate in Texas.
Obtain an "affidavit of heirship to a motor vehicle" on any car titles that are listed in only one party's name. This form--VTR-262--can be acquired through the Texas Department of Motor Vehicles at Dot.state.tx.us, or requested by phone at 512-463-8588. This form allows vehicles to transfer to a beneficiary without the need of probate in Texas.
Change a home title to create a joint tenancy with right of survivorship, if the home is only in one party's name; or have a knowledgeable estate attorney create a "life estate arrangement." Either automatically transfers the deed of the property to the other party, avoiding Texas probate.
Acquire a durable power of attorney on each party, giving the other party the right to handle all financial and legal matters should one party be unable to handle them. This legal document gives the designated "attorney" the ability to make sure that all assets are worded correctly prior to the other party's death, allowing the estate to avoid Texas probate.
Place all assets in a trust--such as a living trust--that clearly spells out a beneficiary of the trust. This is common estate practice with husbands and wives. At the time of one party's death, the assets remain in the trust, negating the need to transfer any ownership.
Discuss estate decisions with any children, spouses or ex-spouses ahead of time. Texas probate will automatically be involved if there is any contest to a party's decision about what to leave whom; resolving any issues beforehand can halt a problem before it starts, avoiding the Texas probate system entirely.