Disclaimer: This article is for educational purposes and does not constitute legal advice.
Detailed Answer
When someone dies, the probate court appoints a personal representative (often called an executor or administrator) to collect assets, pay debts and manage ongoing bills until the estate closes. In Texas, you begin by filing an application with the probate court in the county where the decedent lived. Once the court issues Letters Testamentary or Letters of Administration, the personal representative gains authority to act on behalf of the estate.
The representative must open a dedicated estate bank account. All estate income—such as rental proceeds, dividends or refunds—should flow into this account. Use only these funds to pay probate expenses. Separate personal and estate money to maintain clear records and comply with Texas Estates Code §352.001, which establishes the order in which you must apply estate funds: first funeral and administrative expenses, then secured debt, priority claims and finally general creditors. (Tex. Est. Code §352.001).
Next, notify known creditors and publish notice in an approved local newspaper. Creditors then have 120 days to file claims. (See Tex. Est. Code §308.051.) During this period, you can pay interim expenses such as mortgage payments, property taxes, utility bills and insurance to protect estate assets.
Maintain a detailed expense ledger. Include dates, payees, amounts and purpose. When you file the final accounting with the court, you’ll submit this record for approval. The court will review payments against the order of priority in §352.001 before authorizing any distributions to heirs.
If estate assets are insufficient to cover all bills, Texas law permits the representative to decline claims in full or in part according to the priority schedule. In rare cases where assets fall short, unpaid general creditors may receive nothing. Communicate regularly with beneficiaries to explain the estate’s financial status and the timeline for closing probate.
Helpful Hints
- Open a separate estate bank account immediately after qualification.
- Keep thorough records of every transaction with invoices, receipts and bank statements.
- Notify all known creditors promptly and publish notice as required by Tex. Est. Code §308.051.
- Pay critical bills first—mortgage, property taxes, insurance—to prevent asset loss or penalties.
- Review the order of payment under Tex. Est. Code §352.001 before settling multiple claims.
- File an interim accounting if probate will last more than one year to keep the court informed.
- Consider hiring a probate attorney to handle complex estates or disputes.