Past a certain size, probate stops being a filing exercise. The real work is tax, valuation, and keeping the assets producing while the estate stays open, and the mistakes get expensive in a hurry.
A federal estate tax return is due within nine months after the date of death. Form 4768 buys an automatic six-month extension of time to file. Nine months sounds generous until you try to get a closely held business appraised, a mineral portfolio valued, and date-of-death statements from a dozen institutions, with a family that has not agreed on anything yet.
The first thirty days matter more than people expect. That is when the information is still gatherable and the appraisers still have calendar space.
Instructions for Form 706, “When To File.”
An executor can transfer the deceased spouse’s unused exclusion to the surviving spouse only if the estate tax return is filed on time: within nine months of death, or within the extension period. Estates that owe nothing routinely skip the return and lose the election, and nobody notices until the survivor dies years later with a much smaller exclusion than the family expected.
There is a fix, within limits. An estate that was not required to file under section 6018(a) can make a simplified late portability election by filing a complete and properly prepared Form 706 on or before the fifth anniversary of the decedent’s date of death, with the return stating at the top that it is filed pursuant to the revenue procedure to elect portability. That relief took effect July 8, 2022, and it superseded the earlier two-year window.
If you are a surviving spouse and no return was filed when your husband or wife died, the date of death is the only fact that matters for this. Check it.
Rev. Proc. 2022-32, §§ 3.01, 4.01, 7.01.
While it is open, an estate files its own income tax returns, and the choices made on them, fiscal year, deductions taken on the income return rather than the estate tax return, timing of distributions that carry income out to the beneficiaries, change what the family actually keeps. These are decisions, not data entry, and they are easier to get right when the same people handle the returns and the administration.
An El Paso estate often reaches past the county line. Texas and New Mexico are both community property states, but they are not the same, and property acquired on one side of the line and traded for property on the other produces characterization questions that drive who inherits what. Real property across the border is governed by another country’s law entirely and is not administered by a Texas court.
Characterization is not a technicality in these estates. It frequently decides the largest number in the case.
See also: contested heirship.
A closely held business, a minority partnership interest, or a mineral portfolio has no quoted price. Everyone involved has an incentive pulling a different way: a low number for estate tax, a high number for the beneficiary being cashed out, and something defensible for the fiduciary who has to sign the return. Getting the appraisals built properly, and early, is usually worth more to the family than anything that happens in a courtroom.
El Paso County has two statutory probate courts. Those courts also have jurisdiction concurrent with the district court over suits by or against a trustee, suits involving inter vivos and testamentary trusts, and claims against an agent under a power of attorney, so a complex estate with a trust and a lifetime-transfer problem can usually be handled in one place rather than three.
Tex. Gov’t Code § 25.0731(b); Tex. Est. Code §§ 32.005, 32.007.
If there is a business, mineral income, property in more than one state, or a possible estate tax return, the first call is worth making before anything is filed. Bring the date of death and a rough list of what the estate holds.
The first conversation is short and free.