It may come as a surprise to some in Texas to learn that the probate process was among the issues recently considered by the highest court in the nation. At issue before the U.S. Supreme Court was the ability of a trust beneficiary to assert a claim against the trustees in federal court rather than in state court. The matter centered on the estate planning tools used by the parents who had originally created the plan.
The beneficiary of the trust claimed that the trustees, who happened to be her sisters, had violated their duty to care for the assets held by the trust. The trust was funded by using an estate planning tool known as a pour over will. When the parents died, the will placed assets into the care of the trust.
The court held that the case could not be heard by the federal court. This is because, once the trust owned the assets, the probate court was no longer able to hear the case. In fact, one of the reasons that people in Texas turn to trusts in their estate planning is the ability to avoid the probate process.
Entering into the estate planning process can lead to questions for many people in our state. The good news is that there are many options available that can be customized to fit any estate, regardless of its size. Many people combine several tools to best achieve goals such as avoiding the probate process and limiting potential probate disputes. Researching the options available is a good first step toward developing an effective and comprehensive estate plan.
Source: wealthmanagement.com, “Stripping Away the Mystery of the Probate Exception,” John T. Brooks and Samantha E. Weissbluth, April 23, 2013