Dear Mr. Premack: My mother has always been a very private person. She does not like other people to know about her personal affairs. She is older now, and though in good health, knows she won’t live forever. She has asked me to be Executor in her Will and I’ve agreed. When I was Executor for my uncle who died, I recall having to file a listing of all his bank accounts and investments with the court. The court records are open to the public, and I know that would horrify mother. Do you have any suggestions for ways to maintain her privacy? H.W.
The listing of financial records to which you refer is called an Inventory, Appraisement and List of Claims. Under state law, an Executor of an estate is required to file that Inventory with the court within 90 days of becoming Executor. This law exists to allow the estate’s creditors to see whether the estate has sufficient assets to pay their claims.
Inventories are indeed public records, and contain a great deal of personal information. For instance, the Inventory must list all of the decedent’s real property located in Texas plus valuations of the real property. It must include all of the bank accounts, including the account number and bank name and balance at the date of death. The same is required for investments like brokerage accounts, stocks, bonds, automobiles, insurance payable to the estate, property held jointly with others, and personal effects.
Bexar County holds those records in files at the courthouse, which can be viewed by anyone willing to travel to the courthouse, find the right office, look up the estate number in the computer, and sign a written request to see the file. Eventually, those records may be made available on the county’s website for anyone to view from any computer. Already several other Texas counties (like Travis County) make estate records, including Inventories, available on their websites along with other public records.
Your mother is not the only person concerned about privacy and the possible abuses that may come from the public availability of all that personal data. Several legislative sessions have entertained bills meant to provide cures. For instance, one bill from a few sessions ago would have allowed the court to order an Inventory sealed from public view – but that bill did not pass into law.
In the latest legislative session, a new bill was finally approved and went into effect on September 1, 2011. The law now states when 1) there are no debts (except for secured debts like a mortgage), and 2) all beneficiaries named in the Will have been given a copy of the Inventory, then it is not necessary to file the Inventory with the court. Instead, the Executor can file an affidavit telling the court that the new law has been followed. Thus, the private information is released only to the estate’s heirs, and not to the general public.
If your mother wants to keep things even more private than that, she should investigate legal methods to avoid probate. For instance, she could work with a qualified attorney to set up a Revocable Living Trust. She would transfer her assets to the trust. When she eventually dies, those assets are distributed by the Trustee to the individuals specified by your mother under the terms of the trust. If all the assets pass via the trust, no probate is required and no Inventory is necessary. Her privacy is protected best when she is proactive by making a legally binding plan that specifically addresses her concern.
Paul Premack is a Certified Elder Law Attorney practicing estate planning and probate law in San Antonio.
Original Publication: San Antonio Express News, September 23, 2011