Probate Basics: Probate Assets vs. Non-Probate Assets

Probate. What is it and do you need it? Well, if you ask any probate attorney, their response will be the typical lawyer response “it depends.” Probate is a legal process by which courts will appoint a representative of the estate to pay the decedent’s debts, as needed, and to facilitate the distribution and transfer of remaining assets to heirs or beneficiaries by will, if a will is present. The necessity for probate is based on the decedent’s debts and assets, and the classification of probate and non-probate assets. Not all estates require probate and not all transfers of assets are subject to probate.

Non-probate assets can be transferred directly to beneficiaries without filing for probate. Non-probate assets can include:

• Property held in trust

• Bank accounts with either joint ownership or payable on death beneficiaries other than the deceased

• Life insurance or brokerage accounts with a listed beneficiary other than the decedent

Probate assets do require a form of probate to be filed prior to transferring the assets. Probate assets can include:

• Real property in the name of the decedent

• Bank account solely owned by the decedent

• Bank accounts, brokerage accounts, life insurance etc. without designated beneficiaries listed

Given how much estates can vary, the State of Texas offers two types of formal probate procedures along with other, more efficient alternatives when certain circumstances are present. It is important to know that if a valid Will is present, the doors open to probate methods that are faster and far less costly.

The information contained in this post is provided for informational purposes only, and should not be construed as offering legal advice, or creating an attorney client relationship.