ESTATE PLANNING
Estate planning is preventative legal action which often includes elements of family law, tax law and probate law. The purposes of estate planning vary depending upon the timing, circumstances and goals of the client. Some purposes of estate planning are listed below along with examples. The list and examples are not exhaustive.
A. Preventative legal action to insure the protection of loved ones under certain circumstances. Pre-marital and even post-marital agreements provide certain rights and liabilities upon marriage dissolution.
Originating in family law, these agreements nevertheless can be used as an estate planning tool to maintain a certain level of pre-marital status quo and are often used by individuals previously married and who wish to protect children of a prior marriage.
B. Preventative legal action to insure the smooth, efficient and proper transfer of property under certain circumstances.
Without a doubt a well drafted will meets this purpose but other documents such as a Buy/Sell Agreement can help small businesses fulfill this purpose when the need arises to transfer ownership upon the death or disability of one of the principals.
C. Preventative legal action to reduce estate taxes.
A well known and often used technique to reach this goal is the establishment of an irrevocable living trust wherein a party transfers property from his control and estate but continues to receive many of the benefits during his or her lifetime. A testamentary trust, in other words a trust established in a person’s will can often also avoid or reduce estate taxes.
D. Provide lifetime gifting for a particular purpose.
Funds set aside in certain accounts for children or grandchildren’s college are a good example of meeting this estate planning purpose.
E. Qualify for certain Government Programs.
Sometimes a disabled person has an income level high enough to disqualify that person for benefits but not high enough to enable him or her to adequately hire or pay for the assistance necessary to live independently. A Miller or Special Needs Trust may be an appropriate tool under these circumstances.
F. Provide for end of life or special circumstances directions.
Several instruments illustrate these goals. Often called a living will, a Directive to Physicians informs others what a person’s desires are regarding end of life treatment or the withholding of treatment should the need arise. Another example is the Medical Power of Attorney, which allows a person to name someone else to make decisions regarding medical treatment when that person is no longer able to make his or her own medical treatment decisions. Lastly, a Power of Attorney allows a person to name someone to make non-medical decisions effective either immediately or later upon disability. These types of Powers of Attorney may be either general, in other words broad in nature, or special and limited in authority.
The foregoing are common examples of estate planning tools. As stated above the list is by no means exhaustive.
PROBATE
Probate is the court transfer of property and resolution of liabilities upon a person’s death when the person died with a will. Administration is the court transfer of property and resolution of liabilities upon a person’s death when the person died without a will. Texas law allows a person to appoint an Independent Executor in his or her will. Through the use of an Independent Executor, the deceased person’s estate saves a great deal of time and money in settling the deceased person’s affairs. Failing to appoint an Independent Executor in a person’s will or dying without a will can lead to a more cumbersome, expensive, and time consuming process. If a person dies without a will not only does the state effectively name the beneficiaries but the process becomes a variation of what is known as an heirship proceeding or Proceeding to Determine heirship. In these cases the court will appoint an attorney ad litem to represent the unknown heirs. While most courts make an effort to streamline the process and keep costs down, there is little doubt that this process is generally more costly than probating a will with an Independent Executor.
We have many years experience and represent clients in a wide variety of estate planning, probate and related areas.
- Wills
- Trusts
- Pre-Marital/Post-Marital Agreements
- Buy-Sell Agreements
- Probate
- Heirship
- Guardianship
- Special Needs Trusts
- Miller Trusts
- Powers of Attorney
- Directives to Physicians
- Medical Powers of Attorney
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