Required Filings with the Court
Texas law permits the appointment of a guardian for the ward’s person (physical well-being) and the ward’s estate (financial well-being). If your appointment is as guardian of the ward’s estate, the following filing requirements apply to you:
Bond and Oath
The bond must be filed within twenty days (20) of appointment. An appointee cannot qualify as guardian and Letters of Guardianship cannot be issued without the court’s approval of the bond. The date the bond is approved and the oath is signed is called the “qualification date.”
Inventory, Appraisement, and List of Claims
An Inventory, Appraisement, and List of Claims must be filed by your attorney on your behalf within thirty (30) days of the qualification date. The Inventory, Appraisement, and List of Claims must be verified and list, describe, and declare the value of the ward’s property as of the qualification date.
Allowances and Expenditures, Notice of Appointment
Within thirty (30) days of the qualification date, your attorney must file on your behalf an application requesting monthly or annual allowances to be expended from guardianship funds for the use and benefit of the ward.
Most expenses must be approved by the court, including attorney fees paid from the ward’s estate and cash allowances given to the ward. Expenses not requiring court approval include: premium for the guardian’s bond, court and filing costs, and the ward’s taxes. In addition, your attorney should publish a Notice of Appointment, printed in the county where letters are issued.
In the event expenditures are made in good faith by the guardian to either the ward or the ward’s spouse or dependents, the court may approve such expenditures provided that it was not convenient or possible to obtain court approval first, the expenditures were reasonable and proper based upon clear and convincing evidence, and the court would have granted the authority to make the expenditures had an application been filed in advance.
An investment plan must be filed within one-hundred and eighty (180) days of the qualification date, unless waived by the court.
The court will typically make such determination after the filing of the sworn Inventory, Appraisement, and List of Claims. As guardian, you are expected to be prudent and exercise good judgment when investing and managing a ward’s estate. Several factors should be taken into consideration when making an investment decision involving the estate of a ward, including but not limited to: (1) costs of supporting the ward; (2) the ward’s age, education, current income, ability to earn additional income, net worth, and liabilities; (3) the nature of the ward’s estate; and (4) any other resources reasonably available to the ward.
Only safe investment options should be considered. Some examples include government bonds and interest bearing time deposits that are insured by the Federal Deposit Insurance Corporation (FDIC). The court will determine whether a guardian has prudently managed an estate by reviewing the investments collectively as opposed to individually.
The Annual Account is filed each year within sixty (60) days after the anniversary of the qualification date.
The Annual Account must be prepared by your attorney on your behalf. This form is accompanied by an affidavit which attests to the accuracy of the information provided and is signed by you. You should keep and organize all receipts of disbursements made on behalf of the ward out of the estate.
In addition, all bank and financial statements during the accounting period should be given to your attorney for the preparation of the Annual Account. A bank officer must sign a verification of funds prepared by either your attorney or by the bank verifying funds at the end of the accounting period.
You must also provide a voucher for each item of credit that is claimed in the account. Proof of the existence and possession of securities or other assets held in a financial institution is also necessary. After the Annual Account is approved by the court, you may order updated Letters of Guardianship for the Estate. Failure to file an Annual Account could result in removal.
Consult your attorney if the guardianship estate should be closed. There are many circumstances in which this may be necessary.
The guardianship estate must be closed when the ward dies, is restored, or in the case of a minor, when the ward becomes an adult, assuming the adult ward is not found to be incapacitated by the court. A minor child becomes an adult by either reaching the age of eighteen (18), having their disabilities as a minor removed according to the law, or through marriage. Additionally, a guardianship estate must be closed when an incapacitated ward is restored to full legal capacity, or when the spouse of a married ward has qualified as survivor in a community administration and the ward does not own separate property.
Further, a guardianship estate becomes unnecessary when the ward’s estate is exhausted or when the foreseeable income accruing to the ward or to the estate is so negligible that maintaining the guardianship would be burdensome. Finally, when all assets of the estate have been placed in a management trust or have been transferred to a pooled trust subaccount in accordance with a court order, the court may determine that a guardianship estate is no longer necessary.
A Final Account must be prepared by your attorney when closing the guardianship estate is desired. Once the Final Account is approved, the Application to Close and Discharge the Guardian of their Bond and the Receipt must be prepared by your attorney and filed with the County Clerk’s office.
Sales and Abandonment of Property
Any sale or abandonment of property, including personal property and real estate, must be approved by the court. If real estate or tangible property does not serve the ward and represents a liability or an ongoing expense to the ward’s estate, it should be sold or perhaps abandoned if it lacks value. Retention of such property will require court approval.