{"id":12224,"date":"2021-05-16T15:00:18","date_gmt":"2021-05-16T20:00:18","guid":{"rendered":"https:\/\/legaltalktexas.hammerle.com\/?p=12224"},"modified":"2025-06-18T17:02:02","modified_gmt":"2025-06-18T22:02:02","slug":"the-probate-talk-administrators-creditors-and-beneficiaries-need-to-know","status":"publish","type":"post","link":"https:\/\/hammerle.com\/legaltalk\/probate\/the-probate-talk-administrators-creditors-and-beneficiaries-need-to-know\/","title":{"rendered":"The Probate Talk Administrators, Creditors and Beneficiaries Need to Know"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Let\u2019s talk probate. At some point in your life, you may find yourself an administrator, a beneficiary or a creditor of a probate estate. You may even want this information for <a href=\"https:\/\/hammerle.com\/practice-areas\/estate-planning-probate\/\">planning your own estate<\/a>. Listen up.\u00a0\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Administration of a Probate Estate<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">At its most basic, <\/span><a href=\"https:\/\/hammerle.com\/practice-areas\/estate-planning-probate\/probate\/\"><span style=\"font-weight: 400;\">probate<\/span><\/a><span style=\"font-weight: 400;\"> involves assets, debts and distribution. The administration of a probate estate involves the collection of all assets owned by and all claims owing to the decedent, the payment of all debts, liabilities, claims, and expenses owed by the decedent or his estate, and the distribution of the remaining assets to the beneficiaries. If that sounds a bit complicated, then consider this additional factor: the admission of the decedent\u2019s will to probate can be challenged for up to two (2) years from the date it was actually admitted to probate. In other words, everything about the probate administration is unsettled for at least 2 years.\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Yikes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Yes, you think, but you have that covered because you planned to <\/span><a href=\"https:\/\/hammerle.com\/legaltalk\/estate-planning-and-probate\/to-probate-or-to-not-probate-should-you-avoid-it\/\"><span style=\"font-weight: 400;\">avoid probate<\/span><\/a><span style=\"font-weight: 400;\">. You created beneficiary designations on all of your assets \u2013 or perhaps you created a trust and transferred all of your assets into it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Game over? Hardly. Any creditor can open a probate estate and sue to drag assets back into it. Any disappointed would-be heir can sue and claim you made those designations\/transfers when you were incapacitated, unduly influenced or the victim of fraud. In short, it may not be possible to avoid probate. Now let\u2019s get back to the probate itself and the administrator\u2019s responsibility.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Responsibilities of a Probate Administrator<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Most lawyers recommend that the administrator handle the estate with the highest level of formality. Scrupulous books, back- up receipts, no hint of self-dealing\u2026. the works. This is crucial if the administrator is going to successfully defend potential claims and avoid potential liability to the ultimate beneficiaries and creditors.\u00a0\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The appointment of a person as administrator, especially if it is an independent administrator without court supervision, comes with both broad powers and high fiduciary duties. A smart administrator will keep the beneficiaries of the estate reasonably informed of the administration, use best efforts to promptly collect the assets, and diligently administer and settle the estate.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The administrator must always be in a position to account for all revenue received, moneys spent and assets sold. An administrator should never commingle the estate property with his or her own funds or business interests.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Never means never. Nothing good will ever come from commingling fiduciary funds.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">An administrator should not engage in any self-dealing, such as buying or selling assets, with the probate estate. This is a best practice, but be aware there are a few exceptions if the proper guidelines are followed.\u00a0\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">An administrator must obtain a separate taxpayer identification number for the probate estate. Using this number, the administrator should open one or more accounts at a bank or trust company to hold\u00a0 the estate\u2019s cash and investment grade assets. The account should be styled in the administrator\u2019s name, on behalf of the probate estate. Everything in cash should pass through the estate account, and every receipt and disbursement should be documented in detail.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">No distributions should be made to beneficiaries until the creditors are paid. No creditors should be paid until the taxes are paid. Taxes are a big part of estate management. The administrator is personally liable if money is paid out to creditors or beneficiaries and not enough is left in the estate to pay the taxes.\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">There is a lot to <\/span><a href=\"https:\/\/hammerle.com\/legaltalk\/estate-planning-and-probate\/probate-and-its-process-explained\/\"><span style=\"font-weight: 400;\">estate administration<\/span><\/a><span style=\"font-weight: 400;\">. You need to know about it.<\/span><\/p>\n<p><a href=\"https:\/\/hammerle.com\/lawyers\/virginia-hammerle\/\"><i><span style=\"font-weight: 400;\">Virginia Hammerle<\/span><\/i><\/a><i><span style=\"font-weight: 400;\"> is an attorney with <\/span><\/i><a href=\"https:\/\/hammerle.com\/\"><i><span style=\"font-weight: 400;\">Hammerle Morris Law Firm<\/span><\/i><\/a><i><span style=\"font-weight: 400;\"> whose practice includes <\/span><\/i><a href=\"https:\/\/hammerle.com\/practice-areas\/estate-planning-probate\/probate\/\"><i><span style=\"font-weight: 400;\">probate law<\/span><\/i><\/a><i><span style=\"font-weight: 400;\">, <\/span><\/i><a href=\"https:\/\/hammerle.com\/practice-areas\/estate-planning-probate\/estate-planning\/\"><i><span style=\"font-weight: 400;\">estate planning<\/span><\/i><\/a><i><span style=\"font-weight: 400;\"> and <\/span><\/i><a href=\"https:\/\/hammerle.com\/practice-areas\/estate-planning-probate\/estate-and-trust-litigation\/\"><i><span style=\"font-weight: 400;\">contested litigation<\/span><\/i><\/a><i><span style=\"font-weight: 400;\">.\u00a0 To receive her newsletter contact her at legaltalktexas@hammerle.com.\u00a0\u00a0<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400;\">\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Let\u2019s talk probate. At some point in your life, you may find yourself an administrator, a beneficiary or a creditor of a probate estate. You may even want this information for planning your own estate. Listen up.\u00a0\u00a0 Administration of a Probate Estate At its most basic, probate involves assets, debts and distribution. The administration of [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":12225,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[1225],"tags":[685,41],"class_list":{"0":"post-12224","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-probate","8":"tag-estate-planning","9":"tag-probate"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>The Probate Talk Administrators, Creditors and Beneficiaries Need to Know - Hammerle Morris Law Firm<\/title>\n<meta name=\"description\" content=\"At some point in your life, you may find yourself an administrator, a beneficiary or a creditor of a probate estate. Here is important information to know.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/hammerle.com\/legaltalk\/probate\/the-probate-talk-administrators-creditors-and-beneficiaries-need-to-know\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Probate Talk Administrators, Creditors and Beneficiaries Need to Know - Hammerle Morris Law Firm\" \/>\n<meta property=\"og:description\" content=\"At some point in your life, you may find yourself an administrator, a beneficiary or a creditor of a probate estate. 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