Often times survivors of a decedent are afraid of probate, fearing the small amount in the estate will be eaten up by all the creditors and probate fees. But in Texas, the legislature has created several protections for a surviving spouse and family.
First, most property accumulated during a couple’s marriage is considered to be the property of both of them equally, i.e., community property. Property owned by one party prior to marriage, and gifts and inheritances received by one of the parties during the marriage are generally considered separate property. However, characterizing a couple’s property at death can be tricky because of some of the exceptions to these general rules. Additionally, if a couple has a prenuptial agreement or a postnuptial agreement related to the character of their property, that may supersede these general rules. But this first step of characterizing all of the couple’s property as community or separate property is critical to how it will be treated during probate.
The second protection for the surviving spouse and family is called a Family Allowance. This allowance is intended to provide for the surviving spouse, the decedent’s minor children and the decedent’s adult incapacitated children. The amount allotted by the court is to be an amount sufficient to maintain those individuals for a period of one year after the date of death. A number of factors are evaluated in determining this family allowance.
If a couple owns its primary residence, the surviving spouse has the right to occupy that “homestead” during the surviving spouse’s lifetime. This right exists even if the home was left to someone else under decedent’s will and even if the home was characterized as the decedent’s separate property. Additionally, the guardian of decedent’s minor children may apply for a court order authorizing the guardian and minor children to occupy the homestead. The surviving spouse (or guardian of minor children) will have certain financial obligations regarding the home while they occupy it. Upon the death of the surviving spouse (or end of the court order regarding the minor children) the home will revert to the person or persons who have legal title to the property. If the couple did not own the home they lived in, provision is made for an “allowance in lieu of homestead.” The allowance amount is less than the actual amount of the probate homestead, but it is meant to ensure that the surviving spouse of even the smallest estate does not walk away with no ability to provide for their future.
Finally, Texas law allows the set-aside of a certain amount of personal property that will be exempt from creditors’ claims. The law includes a detailed list of items that will qualify as personal property that can be set-aside – it does NOT apply to everything. If the specific items listed in the law are not included in the estate, a cash amount can be provided. The amount varies depending on whether the surviving spouse is single or has a family. The cash amount usually is less than the actual amount of the exempt personal property, but it (like the allowance in lieu of homestead) is meant to ensure that the surviving spouse of even the smallest estate does not walk away with no ability to provide for their future.
In an estate where the surviving spouse or family might otherwise end up with very little or nothing, these protections serve a very real and appreciated purpose. However, as is evident from carefully reading the descriptions above, it is important that the surviving spouse and family received knowledgeable and experienced counsel regarding the probate process. Otherwise, the protections intended may not be put into place.