If you own property, your estate will be better handled if you have a Will. However, if a loved one has died without a Will, you need to know your best options.
For most estates, the best answer is opening an administration and a formal declaration of heirship. Although more expensive than probating a Will, this proceeding is not necessarily exceedingly expensive unless there is a non-cooperative family member. Unfortunately, if there is a non-cooperative family member, the administration of the estate will be court supervised and will be significantly more expensive. The goal is for the family to reach agreement as to who will administer the estate and agree they don’t have to be bonded or court supervised.
Because administrations of estates can be expensive, some are eager to look for alternatives. In most cases, the alternative doesn’t solve the problem, but here are some things to consider:
Affidavit of Heirship for a Motor Vehicle: If the only assets in the decedent’s name are vehicle titles, the Department of Motor Vehicles of the State of Texas allows the transfer by an Affidavit of Heirship, assuming there is no Will. The form can be found at this link: https://www.txdmv.gov/sites/default/files/form_files/VTR-262.pdf
A Small Estate Affidavit: A small estate affidavit is possible, but only in limited circumstances. First, the estate must be small, less than $75,000 excluding a homestead to be transferred to a spouse. The most common disqualifier is that the property to be transferred (the decedent’s homestead or any other property) is passing to their children. A small estate affidavit will be rejected if there is real estate passing to anyone other than a surviving spouse. The vast majority of small estate affidavits filed in Dallas County, Texas are rejected by the Courts as non-compliant. In most circumstances, when reviewed by an attorney, the circumstances do not fit for a small estate affidavit. As an alternative to full heirship, the small estate laws of the State of Texas generally have failed to help families avoid the costs of estate administration, and I hope the Legislature looks at reforming this process.
An Affidavit of Heirship: When there is only real estate to be transferred, it is often suggested by uninformed persons, including non-probate attorneys, that an Affidavit of Heirship can be used. A longer discussion can be found at this article; however, the short story is that an Affidavit of Heirship can be accepted or rejected by a buyer, a title company, a bank, or an insurance company without any reason. That is because an Affidavit of Heirship does not establish ownership in the heirs, it is only an affidavit asserting ownership. Since the beauty of the affidavit is in the eyes of the beholder, there is no guarantee that an Affidavit of Heirship will work in any circumstance.
Is There Even a Probate Estate? It is possible that a person dies with assets, but there be no probate estate. Although it is usually not a good planning method, some people luck into having a non-probate estate because they have moved all of their assets to transfer on death accounts, or their equivalent. If there are no assets left in the name of the decedent after beneficiary designations, transfer on death, payable on death, and other similar designations are considered, there is simply no need for probate. You are one of the lucky few.
If you are the more common situation where your loved one has died without a Will, the shortcut procedures will not work, and opening an administration of an estate is necessary, the heirs should first come together and discuss their options, try to jointly agree how to move forward, and hire one attorney if at all possible. If disputes can be eliminated, and agreements can be reached as to who will administer the estate, the lack of a Will does not necessarily mean that some lawyer will popping the champagne corks.
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, specific tax, legal or accounting advice. We can only give specific advice upon consulting directly with you and reviewing your exact situation.
