[TX] Can a small estate affidavit be used to claim funds from a deceased parent’s account?

TX Estate Probate

Brandon

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Is a Small Estate Affidavit the Right Tool? (TX Est Code § 205.001) In Texas, a Small Estate Affidavit can be used when:

The person died without a will.
The total value of their probate estate, not counting exempt property, is $75,000 or less.
There is no pending probate.
The estate does not include real property other than a homestead.

Here is the key issue in your situation:

The PayPal account was in your mom's personal name, not in the nonprofit's name. Even though it was used for nonprofit donations, legally it is treated as part of her estate.
So yes, a Texas Small Estate Affidavit is typically the correct mechanism if there was no will and the estate qualifies under the $75,000 threshold.
You do not need to know the exact PayPal balance before filing. You estimate the value as best you can. You can list it as "PayPal account associated with the deceased's email address, balance unknown at time of filing."
Courts understand that some assets require formal authority before companies will disclose balances.

Why PayPal Is Asking for This. PayPal's bereavement team is trying to confirm two things: that the account holder is deceased, and that you have legal authority to act for her estate. Since there is no will, they need proof that you are an heir and authorized representative. A court approved Small Estate Affidavit gives you that authority. Without court approval, a notarized affidavit alone is usually not enough for financial institutions.

How Texas Intestacy Works in Your Case. Since your mom had no will and was not married, please correct me if that is wrong, and you and your brother are her only children, under Texas law you and your brother inherit equally. Each of you would be entitled to 50 percent of the estate. Even though you plan to give the funds to the nonprofit, the law still treats the money as estate property first. (TX Est Code § 201.051)

What Is a Distribution Chart? In a Texas Small Estate Affidavit, the distribution chart simply shows who the heirs are, their relationship to the deceased, and what percentage they inherit. In your case, it would likely look like: heir one, 50 percent; heir two, 50 percent. It is just a visual breakdown for the court to confirm how the estate passes under intestacy law.

Practical Steps You Should Take. Here is how I would approach this if I were guiding you step by step:

Confirm estate eligibility. Confirm total estate value under $75,000, confirm no probate has been opened, and confirm no real estate needs to transfer.
Prepare the Texas Small Estate Affidavit. List the PayPal account as an asset, list any other known assets, list any debts, complete heirship information, and include the distribution chart.
File in the probate court in the county where your mom lived at the time of death. The court must approve the affidavit before it becomes effective.
Submit to PayPal. Once court approved, send the court approved Small Estate Affidavit, the death certificate, your ID, a W-9 for the estate, and a written instruction letter directing the funds.

Important Consideration About the Nonprofit. Here is something that matters legally: even though the donations were intended for the nonprofit, because the PayPal account was in her personal name, the funds legally belong to her estate first. After you and your brother receive them, you can transfer them to the nonprofit.

If the nonprofit is still active and registered, it may help to include a statement in your cover letter that the funds will be transferred to the nonprofit, and possibly include documentation showing the nonprofit exists and has a new director. That shows transparency and good faith.

A potential complication. If the estate includes other assets that push it above $75,000, a Small Estate Affidavit would not be appropriate. In that case, you might need an Application to Determine Heirship, or a dependent administration. But based on what you have described, this sounds like a small estate situation.

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My mom passed away in 2020. When she passed we lost the ability to access the PayPal account to which donations were given to her nonprofit. It was a personal PayPal account and was only tied to the nonprofit by bank account. Shortly after she died that bank account was compromised. We had to close and open a new account for the nonprofit. We recently found out that people were still donating to that account. We need to close the account and have the funds released. I have to submit the following documents to PayPal:

Lexi, Chatbot

I'm sorry to hear about your mom's passing and the challenges you're facing with the PayPal account. Can you confirm if you have access to any documentation related to the nonprofit or the original PayPal account?

A written request from the requestor (or a person who is duly appointed or authorized to administer the estate of the deceased customer) identifying the account by the primary email address and stating that the executor wishes to have the PayPal account closed. The cover letter should also include a statement instructing what to do with any funds that remain in the PayPal account.
Details to help locate the relevant account, such as email address, phone number, or home address.
The requestor's email address so PayPal's bereavement team can reach out directly.
A copy of the death certificate for the account holder.
A copy of a government issued photo ID, such as a driver's license, passport, or state issued ID, of the requestor.
Legal documentation or a copy of the will that identifies the executor of the estate.
State issued documentation if an existing will or other formal legal documentation is not present. PayPal refers requestors to www.affidavitforms.org for state issued documentation.
A W9 of the estate, which can be obtained directly from the IRS website at https://www.irs.gov/pub/irs-pdf/fw9.pdf.

Lexi, Chatbot

Have you already attempted to contact PayPal regarding this issue, and if so, what was their response?

Yes I have, and above is the list of documents I need to submit. I am trying to fill out a small estate affidavit so PayPal will release the funds to me. I need help with that form or direction to the correct form to fill out.

Brandon

Hi there. My name is Brandon, and I'm an attorney. I'll be happy to help you out today. I understand you're trying to fill out a small estate affidavit for PayPal to release funds. Could you tell me more about the specific challenges you're facing with the form?

My brother and I are her only living heirs. We live in different parts of Texas. She did not have a will or anything like that. So I need to know if the small estate affidavit is the correct form. I also don't know the amount in the account, and I don't know what a distribution chart is.

Here is the whole story. My mom had a PayPal account attached to a nonprofit bank account where people could donate to her program. When she passed we opened a new PayPal account, and we had to close and open a new bank account because the old one was compromised. We recently found out that people have still been donating to the old PayPal account. I listed above the documents I need for PayPal. The money in the account will go back to the nonprofit via me once it gets released. My brother and I aren't going to keep it for ourselves. I just need a document that will justify the release of funds to me so I can hand it over to the new director.

Do you have any information to help with this issue?

Brandon

Is a Small Estate Affidavit the Right Tool? (TX Est Code § 205.001) In Texas, a Small Estate Affidavit can be used when:

The person died without a will.
The total value of their probate estate, not counting exempt property, is $75,000 or less.
There is no pending probate.
The estate does not include real property other than a homestead.

Here is the key issue in your situation:

The PayPal account was in your mom's personal name, not in the nonprofit's name. Even though it was used for nonprofit donations, legally it is treated as part of her estate.
So yes, a Texas Small Estate Affidavit is typically the correct mechanism if there was no will and the estate qualifies under the $75,000 threshold.
You do not need to know the exact PayPal balance before filing. You estimate the value as best you can. You can list it as "PayPal account associated with the deceased's email address, balance unknown at time of filing."
Courts understand that some assets require formal authority before companies will disclose balances.

Practical Steps You Should Take. Here is how I would approach this if I were guiding you step by step:

Confirm estate eligibility. Confirm total estate value under $75,000, confirm no probate has been opened, and confirm no real estate needs to transfer.
Prepare the Texas Small Estate Affidavit. List the PayPal account as an asset, list any other known assets, list any debts, complete heirship information, and include the distribution chart.
File in the probate court in the county where your mom lived at the time of death. The court must approve the affidavit before it becomes effective.
Submit to PayPal. Once court approved, send the court approved Small Estate Affidavit, the death certificate, your ID, a W-9 for the estate, and a written instruction letter directing the funds.

Thank you, that makes things easier to understand.

Brandon

Did you understand my answer, and did it address your concern?

Yes it did, thank you.

Brandon

You are very welcome. I wish you the best.

Brandon

17,789 satisfied customers

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