In Texas, administration of community property can be a legitimate alternative to probate. The determination of whether property is community property or separate property can be a complex matter and is often a source of controversy during the administration of an estate. In some cases the community property laws can be used to probate the estate. This is accomplished by informally administering community property.
What is Community Property?
Before considering informal administration, one must understand what community property is. Community property is property acquired by either spouse during the marriage. Community property is everything that is not separate property. There is a presumption that all property acquired by either of the spouses during marriage is community property.
Separate property is property owned or claimed by the spouse before marriage; the property acquired by the spouse during marriage by gift, devise, or descent; and any recovery for personal injury that does not include recovery for loss of earning capacity. This presumption that property is community property can be overcome by a spouse asserting separate property by clearly tracing the origin of the property as an asset on hand before marriage.
Property acquired during marriage, but while residing in another state that is not a community property state is not community property. The Texas Supreme Court addressed this in Estate of Hanau, 730 S.W.2d 663 (Tex. 1987). In Estate of Hanua, the couple married and acquired property while residing in Illinois. They moved to Texas and one spouse died. Illinois is not a community property state. The court concluded that the property acquired during the marriage while residing in Illinois was not community property under Texas probate law.
What is Informal Administration of Community Property?
The Texas Estates Code grants a surviving spouse certain powers over community property when there is no formal probate for the decedent’s estate. These powers allow the surviving spouse to act with respect to the estate property, which can be used in lieu of a formal probate. Thus, the name “informal administration of community property.”
Informal administration of community property is used when:
- There is a surviving spouse,
- All of the decedent’s property was community property,
- There are no other non-spouse heirs,
- A formal probate has not been initiated, and
- The estate does not include real estate that has to be transferred to a third party.
Informal administration can save the time and expense associated with a formal probate administration.
What Powers Does the Surviving Spouse Have after Death?
The surviving spouse is able to:
- Sue and be sued to recover community property;
- Sell, mortgage, lease, and otherwise dispose of community property to pay community debts;
- Collect claims due to the community estate; and
- Exercise other powers as necessary to: (a) Preserve the community property; (b) Discharge community obligations; and (c) Wind up community affairs.
For many modest estates, these powers are more than enough to administer the estate.
What about Small Estate Affidavits, Muniments of Title, or Guardianships?
Small Estate Affidavits, Muniments of Title, Affidavits of Heirship, and Guardianships are also alternatives to probate in Texas. These are covered in other articles on this site. Please visit our Articles section to learn more.
Do you need to Hire an Experienced Probate Attorney to Administer Community Property?
If you are a surviving spouse in Texas, you may be able to administer your deceased spouse’s community property without having to go through probate. This is because, in Texas, community property is generally owned jointly by husband and wife. As such, upon the death of one spouse, the other spouse usually becomes the sole owner of the community property.
However, there are certain circumstances in which it may be beneficial to hire an experienced probate attorney to administer your community property. For example, if your deceased spouse had significant debts or liabilities, it may be necessary to open up a probate estate in order to pay off those debts. Or, if you and your deceased spouse owned real estate in different states, it may be necessary to open up a probate estate in each state in order to transfer ownership of the real estate.
Another reason you might need to hire an experienced probate attorney is if you have minor children from a previous marriage. In this case, it may be necessary to set up a trust in order to ensure that your children inherit their share of the community property.
If you are unsure whether or not you need to hire an experienced probate attorney to administer your community property, you should consult with an attorney who specializes in probate law. Call today for a FREE attorney consultation. (210) 436-6601.
Related Questions
Does a surviving spouse need probate in Texas?
In Texas, if a person dies owning community property with his or her spouse, the surviving spouse generally becomes the sole owner of the community property. The surviving spouse does not need to go through probate in order to receive ownership of the deceased spouse’s share of the community property.
However, if a person dies owning separate property, or if the deceased person’s Will leaves his or her separate property to someone other than the surviving spouse, then probate may be necessary in order to transfer ownership of that separate property.
If you are not sure whether or not your loved one’s estate will need to go through probate in Texas, you should speak with an experienced attorney who can help you understand the laws and requirements in your specific situation.
Can you transfer property without probate in Texas?
There are a few ways to avoid probate in Texas. One way is to transfer property through a will or trust. Another way is to pass on property through joint ownership or community property agreements.
A will is a legal document that allows you to specify how your property will be distributed after you die. You can name an executor in your will, who will be responsible for carrying out your wishes. If you have minor children, you can also appoint a guardian for them in your will.
A trust is another legal arrangement that can be used to avoid probate. With a trust, you can appoint a trustee to manage the property for the benefit of the named beneficiaries. The trustee has a legal obligation to follow your instructions and cannot use the trust funds for their own benefit.
If you own property jointly with someone else, it will pass to the surviving owner when you die without going through probate. This is true whether the joint ownership is with a spouse, family member, or friend. You can also hold property as community property with your spouse. Community property passes to the surviving spouse when one spouse dies.
It’s important to note that these alternatives to probate only apply to certain types of property. For example, retirement accounts and life insurance policies typically have beneficiary designations that override what is stated in a will or trust. So if you want to be sure that your assets are distributed according to your wishes, it’s best to consult with an experienced
Does community property avoid probate in Texas?
If a married couple owns property as community property, then, upon the death of one spouse, the other spouse automatically becomes the sole owner of the community property. The community property does not need to go through probate in order for the surviving spouse to assume ownership.
There are certain requirements that must be met in order for property to be considered community property. First, the property must have been acquired during the marriage. Second, the property must be located in Texas. And third, the property must be held in joint ownership with both spouses having an undivided interest in the property.
If these requirements are met, then the surviving spouse will automatically become the sole owner of the community property upon the death of the other spouse. The community property will not need to go through probate in order for the surviving spouse to assume ownership.
What happens to community property when one spouse dies in Texas?
In Texas, if one spouse dies, the community property generally passes to the surviving spouse. However, there are some exceptions to this rule. For example, if the deceased spouse had a will that specifically left their community property to someone other than the surviving spouse, then that property would not pass to the surviving spouse under Texas law.
It is important to note that, even though community property generally passes to the surviving spouse upon the death of one spouse, the surviving spouse does not automatically have full ownership rights to all of the community property. Instead, the surviving spouse only has what is called a “survivorship interest” in the community property. This means that the surviving spouse has the right to keep and use the community property during their lifetime, but they do not have full ownership rights over it.
After the death of one spouse, any debts owed by the deceased spouse become debts of the estate. The executor or administrator of the estate is responsible for paying off these debts from estate assets. If there are not enough assets in the estate to pay off all of the debts, then creditors may look to collect from the surviving spouse’s share of community property.
If you have questions about what happens to your community property when one spouse dies in Texas, it is best to consult with an experienced attorney who can review your specific situation and advise you of your legal options.
What is probate estate?
In Texas, a “probate estate” is defined as all real and personal property owned by a decedent at the time of their death that is not otherwise exempt from probate. The probate estate may also include property that was jointly owned with another person or held in trusts.
The purpose of probate is to establish the legal ownership of the decedent’s property and to provide for the distribution of that property to the rightful heirs or beneficiaries. In most cases, the court will appoint an executor or administrator to oversee the probate process.
The first step in probate is to file a petition with the court. The petition must include certain information about the decedent and their estate. Once the petition is filed, a notice of hearing will be published in a local newspaper.
At the hearing, anyone who wishes to contest the will or object to the way in which the estate is being handled must state their objections. If there are no objections, then the court will issue an order admitting the will to probate and appointing an executor or administrator.
The next step is to inventory and appraise all of the assets in the probate estate. This includes real estate, vehicles, bank accounts, stocks and bonds, businesses, personal property, and any other assets that are subject to probate. Once all of the assets have been valued, any debts and expenses of the estate must be paid off.
To understand the process in full as it relates to your situation, call us today for a FREE attorney consultation. (210) 436-6601.
