Probate is the legal process of validating a will and distributing assets, which often requires legal aid. Many families worry about covering these attorney costs. But, in Texas, the estate typically covers probate attorney fees.
If you’re concerned about probate for your beneficiaries, a financial advisor can work with you to create an estate plan.
How Probate Works in Texas
Probate is the legal process through which a deceased person’s estate is administered. In Texas, this includes validating the will (if one exists), appointing a personal representative or executor and overseeing the distribution of the deceased’s assets to beneficiaries.
The process typically begins when the executor or a family member files a petition for probate in the Texas probate court. Once the court approves the will or appoints an executor, the executor must notify creditors, gather assets, pay any outstanding debts and file necessary tax returns.
If the decedent left a will, the court’s role is to confirm that the will is legally valid and its instructions are followed. If there is no will, Texas state intestacy laws dictate how the assets will be distributed.
Probate Fees
Common probate fees include court filing fees, attorney fees, appraisal fees for property or other assets and fees related to the executor’s duties.
In Texas, the court filing fee for probate cases can range between $250 and $400, depending on the county. Appraisal fees are necessary when the estate includes real property, valuable personal items or business interests that need to be assessed to determine their value.
Attorney fees are typically the most significant expense during probate. While some probate attorneys charge a flat fee for their services, others charge hourly rates. In Texas, probate attorneys commonly charge $250 to $425 per hour, depending on their experience and the complexity of the case. If the estate involves contested wills or complicated asset distribution, attorney fees can increase significantly due to the time required to resolve disputes.
Who Pays Probate Fees?
In Texas, probate fees, including attorney fees, are generally paid out of the estate before any distributions are made to beneficiaries. If the estate has enough assets to cover the costs, the beneficiaries will receive their inheritance after all debts, taxes and probate-related fees are paid. If the estate does not have enough liquid assets to cover the fees, it may be necessary to sell property or other valuable items to satisfy these expenses.
Additional Fees
When settling an estate, additional costs could arise beyond legal fees. These can vary based on the size and complexity of the estate, and the services required during the probate process. Here are four to keep in mind:
- Executor compensation: In Texas, executor compensation is set at 5% of the total value of the estate’s transactions, including the collection of assets and payment of debts. However, if the will specifies a different arrangement or waives compensation, this fee may not apply.
- Bond fees: If the court requires the executor to post a bond, the executor may need to purchase a probate bond. This bond acts as insurance to protect the estate’s beneficiaries from any potential mismanagement of estate assets. Bond fees vary depending on the value of the estate, but they are usually a percentage of the total bond amount.
- Appraisal fees: Estates with real property or unique assets, such as antiques or fine art, may require professional appraisals to determine their fair market value. Appraisal fees depend on the complexity of the asset being evaluated and can range from a few hundred to several thousand dollars.
- Tax preparation fees: If the estate is large enough to be subject to estate taxes, or if the decedent had significant income in the year of their death, the executor may need to hire a tax professional to prepare and file estate tax returns. Tax preparation fees vary depending on the complexity of the estate’s tax situation.
Can Probate Fees Be Avoided in Texas?
While some probate fees in Texas are unavoidable, there are ways to reduce or bypass them through careful estate planning.
One common strategy is creating a revocable living trust, which allows assets to be transferred directly to beneficiaries without going through probate. Since the trust holds the assets, they avoid the probate process, which can significantly cut down on court and attorney fees.
In addition to trusts, other methods such as joint ownership with rights of survivorship or designating beneficiaries on financial accounts can also help avoid probate. These strategies can allow assets to pass directly to intended beneficiaries without probate.
Finally, a probate attorney or a certified estate planner (CEP) could also help beneficiaries minimize or avoid some of these costs.
Bottom Line
Probate attorney fees in Texas are typically paid out of the estate’s assets, along with other probate-related costs such as court fees and appraisal expenses. The executor is responsible for managing the estate’s funds and ensuring all fees are covered before distributing assets to beneficiaries.
Estate Planning Tips
- A financial advisor could help you create a plan to manage your estate and distribute assets to beneficiaries after your death. 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.
- If you want to save some money and create an estate plan on your own, here are some common pitfalls that you should avoid.
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