Did you know that less than half of all Americans do not even have the basic estate planning documents; let alone a Will. Our laws allow people the opportunity to divide or bequeath your estate to whomever you wish to leave your property to. You are able to get as specific as you want or you can be as broad as you want also in generalizing that your entire estate goes to a beneficiary. So, what happens if you pass away without having a Will in the State of Texas?
The answer is simple: If you die without a will, a statutory formula that does not consider your wishes and unique circumstances will dictate how your assets will be distributed. A statutory formula is a uniformed way that the State comes up with the divide your estate and you simply have no control of how your estate is disbursed or divided.
INTESTATE DISTRIBUTION FOR SINGLE PEOPLE WITH NO CHILDREN
If you are single and die without a Will in Texas, the Texas Estates Code dictates that your assets will be distributed as follows:
- Your estate will pass equally to your parents if both are living. If only one parent is alive, and you don’t have any brothers or sisters, then your entire estate will pass to your surviving parent.
- However, if you do have siblings or descendants of siblings (nieces and nephews), then your surviving parent would receive only half of the estate, and the remaining one half would be divided among your siblings or their descendants.
- All of your estate would pass to your siblings or their descendants if you have no surviving parents.
- If you have no surviving descendants, parents, siblings, or descendants of siblings, then the estate will be divided into two halves. One half will pass to relatives on your mother’s side of the family and the other one-half will pass to relatives on your father’s side.
- If one side of the family has completely died out, the entire estate would pass to the surviving side of the family.
- On extremely rare occasions, when an unmarried person dies without any surviving heir or heirs, their estate will pass to the State of Texas.
INTESTATE DISTRIBUTION FOR THOSE WHO DIE
UNMARRIED WITH CHILDREN
If you are single and have children, then all your property will pass to your children known as descendants . If your descendants are of the same degree of relationship, (meaning, for example, all are your children or all are your grandchildren), then the assets will be divided equally between them.
However, if your descendants are of different degrees of relationship, (meaning some of your children survive while others predecease you, leaving children or grandchildren of their own), then the younger generation will inherit only the share the older generation would have received had he or she survived.
An example – suppose you had three children at the time of passing. If all three survive you, then each will receive 1/3 of your estate. If one predeceased you, but has two surviving children, then the two surviving children would inherit 1/3, but the children of the deceased child would split the deceased child’s share. However, suppose all the children predecease you, and 6 grandchildren in total survive you. In that case, your estate would be split into 6 shares, one for each grandchild.
INTESTATE DISTRIBUTION FOR THOSE WHO DIE WHILE MARRIED
Many people assume that a surviving spouse will inherit all of their deceased spouse’s estate if they die without a Will in Texas. This is not always the case. How their property is divided depends on whether it is characterized as community property or separate property. This type of Probate is the most complex; especially when there are children involved from prior marriages.
Community Property –
In Texas, there is a presumption that all property acquired during a marriage is community property. Under Texas laws, if you are married and your spouse and children survive you, then:
- Your surviving spouse will inherit all your community property if all your children are also the children of your surviving spouse;
- Otherwise, all your one-half interest in the community estate will pass to your children, with your spouse keeping only his or her one-half interest.
If you do not have any children, then your surviving spouse will inherit all of your community property.
Separate Property –
Separate property is property that you owned before you were married, or that you acquired, even during a marriage, by gift or inheritance. The intestate distribution formula is different for separate property:
- If your spouse and children survive you, your surviving spouse will receive one-third of your separate personal property and only a life estate in one-third of your separate real Your children would inherit the remaining interest outright. A life estate simply means that you have the legal right to use the property until you pass away. By the word “use” it is defined as residing within the property as your homestead. You do not have the right to rent the property, sell the property or destroy the property.
- If you are married but have no children or other descendants, your surviving spouse will receive all your separate personal property. However, if you have surviving parents and siblings, the surviving spouse will receive only one-half of the separate real property with the other half passing to the parents, siblings, or descendants of siblings in a manner set forth by the statutes.
Aside from the division of your estate; the Courts have mandated statutory provisions that can be held up within the Probate Courts anywhere from six months to several years if any of the division is disputed. It only takes one person to “dispute” the division of the estate and can leave your family in financial burden trying to allocate your final wishes. If you want the freedom to decide how and to whom your property will be distributed when you die, you need a will.
10 REASONS YOU SHOULD HAVE A WILL
Aside from avoiding everything we previously discussed what happens in the event you die without having a Will the majority of people wonder what the benefits of having a will are. The top 10 reasons for having a Will are as follows:
- The ability to discuss the distribution of your estate with an attorney and seek advice to handle questions that you may not be able to present to your family. The attorney is a neutral third party that’s only interesting is you, and distributing your estate as you have requested.
- The benefits of appointing someone you personally trust to handle the distribution of your estate as opposed to a Court official. The relief of knowing that a loved one is distributing your estate, and your personal effects are genuine relief that only you are able to direct within your will. If you do not have an executed will, then a family member that you may not have had the best relationship with could be appointed as the Executor of your estate
- You leave a legacy behind for your loved ones upon your passing and our Firm provides a “reading of the will” to go over your last wishes with your loved ones. This allows you peace of mind that your family will have the opportunity to discuss your final wishes with an attorney and gather an understanding of the process during a difficult time.
- You must remember that no one is promised a tomorrow and if you have minor children you are able to appoint a Guardian for your children and even appoint a Trustee to look after your child(ren) financial aspects after you pass. This coincides with the Family Courts and assists within custody issues in the event that you are to have an untimely passing.
- For clients that are approaching their senior years, within your will you are able to direct a Guardian to handle your finances and even assist with appointing someone to handle your medical needs also. The benefits of this alone are putting it on record declaring those whom you wish not to be your Guardian while you are of sound mind to make those decisions.
- With an executed will you are assured that an attorney and the Courts will oversee the entire Probate process and are ethically obligated to transfer all titles to beneficiaries that you have left a legacy behind for.
- Having a will also guarantees that you can save money even after passing. Those who have wills executed save on average a minimum of $1,000.00 to $2,500.00 in attorney’s fees probating your estate within the court system. By not having a will, the costs of Probate are higher, witnesses and loved ones have more obligations to attend hearings and provide testimonials before a Judge.
- Although Brandy Austin Law Firm, PLLC does not provide tax advice, we strongly urge you to seek advice from a tax expert to see the benefits that you can avoid by having a valid will. Each state has its own taxes against estates and it is beneficial to pass your property to family to avoid higher taxes against your estate.
- Just as simple as it is to leave a legacy for your loved ones, you are able to do the same for charities. If you do not specifically state within your will that you wish to leave a legacy with a charity it will not come to pass. The laws are specified for your heirs and if you have a charity that you have been donating to; they receive nothing unless you direct so within your will.
- For blended families, a validly executed will is beneficial in the fact that each parent can specifically state as to which children get what inheritance. This works best for all parties because many couples that divorce and remarry have already set aside some of their earnings specifically for their children. This ensures that all children receive an inheritance. An additional benefit is that you can also exclude other children from receiving an inheritance if you so wish.
Therefore, even though it may seem like a scary process to have a conversation with someone to draft your estate plan; it is something that should be done to avoid so many struggles for your loved one. It is actually not as bad or time-consuming as people have imagined or feared the process to be. Society has taught so many of us to not open up and discuss our financials with strangers and to keep things private. It isn’t a private process passing away without having a valid Will because the State then decides how your property is divided. What freedoms have you left the world with having your State decide the fate of your estate? Contact us today to review your estate plan.