Probate costs are typically based on a combination of court fees and professional services. Texas’ probate system is similar to other U.S. states and jurisdictions. The process is organized into two broad categories: testate probate, in which the estate is distributed according to a will, and intestate probate, in which the estate is distributed according to state law. From there, the estate’s administrator or executor manages the costs based on the scope of the estate and any issues. Smaller estates often cost little more than the court filing fees, while larger or contentious estates can cost hundreds of thousands of dollars in filing, legal, accounting fees and more. The costs of probate in Texas are defined in the Texas Estates Code.
If you’re looking to create your own estate, or have any specific estate-planning questions, consider reaching out to a financial advisor to explore your options.
Court and Filing Fees
Every estate will need to pay a range of administrative fees to the probate court. This can include:
- Basic court fees, such as the application to register yourself as the administrator for an estate;
- Filing fees for any document you need to enter with the court, such as a will or other related paperwork;
- And filing fees for documents that you need to receive from the court, such as letters of administration.
Administrative fees can range from as low as $2 to more than $500 for each specific filing or action. For example, it can cost $360 to file the application to have yourself appointed as the administrator of an estate, or $120 to file a contest to some element of the estate or will.
The total cost of probate in Texas, which includes court and filing fees, will depend largely on the nature of the estate. A simple probate may cost no more than $400 in filing and administrative fees, while a sprawling estate may cost thousands of dollars in court fees alone.
Administrator/Executor Compensation
The individual who manages an estate is known as either the executor (if the estate has a will), or the administrator (if the decedent was intestate). It’s their job to handle the management, payment and distribution of all assets and liabilities.
The estate’s administrator/executor is responsible for:
- Locating heirs
- Distributing assets
- Handling contests
- Working with the probate court
- Any other steps necessary to ensure that the estate is distributed legally and properly
This can be a time-consuming task, and Texas law entitles the administrator/executor to compensation. If the decedent had a will, they may have arranged to compensate the estate’s named executor as part of their estate planning. In this case, the terms of the will or agreement will typically govern compensation.
Otherwise, state law sets the executor/administrator’s fee as a percentage of the overall estate. Generally, the administrator/executor receives between 1% and 5% of the estate’s total value as compensation for their work. However, in all cases, including if the parties had an agreement for the executor’s payment, this fee is bounded by a general requirement of reasonability and must be approved by the probate court.
Professional Services Fees
It’s common for a probate process to require professional services, most often those of lawyers and accountants. This can come up for any number of reasons. Often, for example, an estate will need the services of a lawyer to make sure that assets are distributed legally, and to review any issues of property, estate or other laws that come up during the probate process. Or an estate may need the services of an accountant to manage its assets during the probate process and ensure that all assets are located in full.
In all cases, this will generate professional services fees, as the estate must pay the costs of any individuals that it hires. If the decedent died intestate, this can also include advertising fees, as the administrator will be required to post a death and estate notice for a minimum period of time to ensure that potential heirs have an opportunity to come forward.
Typically, professional services fees are billed at an hourly rate. In the case of a particularly complex estate, a probate lawyer might charge a percentage of the estate’s value.
Paying and Minimizing Probate Fees
Absent special circumstances, the costs of probate come from the estate itself. While probate moves forward, the administrator/executor takes all costs from the estate’s assets when and as necessary. If the estate doesn’t have enough cash on hand, they will sell assets to cover these costs.
Heirs who want to contest terms of the estate will pay their own legal fees.
The best way to minimize probate costs is to have a clear, effective estate plan in place. There’s no way to entirely eliminate the cost of probate in Texas, since at a minimum your estate must pay court filing and administrative fees as well as compensation to the executor/administrator. However, a particularly expensive probate is typically driven by high-cost professional services fees and compensation for significant time and trouble on the part of the executor/administrator. A well-drafted will with clear terms can help prevent those costs.
You can also take steps to try and reduce your need and thus the cost of probate in Texas. If the estate is worth less than $75,000 total, you do not have to go through the full probate process in Texas. Otherwise, by moving your largest assets to trusts, joint ownership and payable-on-death accounts, you can remove many of the most contentious or difficult assets from the process, and potentially avoid probate in Texas.
Bottom Line
As in all states, the exact cost of probate in Texas will depend on the scope and nature of the estate. There are usually estate-planning costs; all estates will have to pay some court filing and administrative fees, but more complex estates can run up significant professional bills and administrative fees, as well.
Tips on Writing a Clear Will
- Don’t leave your estate planning to chance. Sit down with a lawyer and draft a clear, simple will that takes care of your loved ones and dependents. And in the process, make sure to avoid these five common mistakes.
- A financial advisor can help you build a comprehensive retirement plan. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Photo credit: ©iStock.com/chrispecoraro, ©iStock.com/designer491, ©iStock.com/shapecharge