FAQs – Wills, Probate and Estate Planning

 

Durable general power of attorney

Questions: What is a durable general power of attorney?
Answer: A durable general power of attorney is a legal document that allows you (the “principal”) to appoint another person (the “agent”) to conduct your business affairs. This document is particularly helpful in your absence or during a time when you may be physically or mentally unable to conduct your business. Since the document is “durable,” it will continue to be in force and effective even if you become legally incapacitated. For all real estate transactions, the durable general power of attorney must be recorded in the county clerk’s office where the property is located.

Questions: Can the durable general power of attorney be revoked?
Answer: Yes. You can revoke your power of attorney by providing your agent with a written revocation or by recording a written revocation in the county clerk’s office. Also, your power of attorney will automatically terminate upon your death or in the event that a court appoints a guardian for you.

 

Durable power of attorney for health care

Questions: What is a durable power of attorney for health care?
Answer: A durable power of attorney for health care is a legal document that allows you, as the principal, to appoint an agent to make your health care decisions for you. You must be incapacitated and no longer capable of making your own health care decisions. Your attending physician must certify in writing that you lack the capacity to make your own health care decisions.

Questions: What types of decisions can my agent make?
Answer: Once appointed, your agent can make a broad range of medical treatment decisions for you. Your agent can consent, refuse to consent or withdraw medical treatment on your behalf. This includes the refusal to activate life support systems or the termination of existing life support systems. Your agent may not consent to: voluntary inpatient mental health services; convulsive treatment; psycho surgery; abortion; or neglect through omission of care primarily intended to provide for the comfort of the principal.

Questions: What is required before a durable power of attorney for health care becomes effective?
Answer: A durable power of attorney for health care is not effective unless the principal, before executing the document, signs a statement indicating that he has received a disclosure statement and has read and understands the contents. The principal must also sign the power of attorney for health care in the presence of two disinterested witnesses.

 

Directive to physicians (living will)

Questions: What is a directive to physicians?
Answer: A directive to physicians is commonly known as a living will. It is a document that allows you to instruct your physician to withhold life-sustaining procedures. A person who has executed a directive to physicians should inform their doctor and request that the directive be made part of their medical records. A directive to physicians will not become effective until two physicians have certified in writing that the patient has an incurable or irreversible terminal condition and that the application of life-sustaining procedures would serve only to artificially prolong the moment of death.

Questions: Can a directive to physicians be revoked?
Answer: Yes. The directive can be revoked at any time-even in the final stages of a terminal illness.

Questions: What if the physician does not want to carry out the directive?
Answer: If the physician chooses not to carry out the intent of the directive, he must make a reasonable effort to transfer the patient to another physician who will comply with the patient’s wishes.

Questions: What is the difference between a durable power of attorney for health care and a directive to physicians?
Answer: A directive to physicians is limited in that it only applies to your decision to withhold or withdraw life support once death is imminent. A durable power of attorney for health care is broader in scope and appoints someone else to make many medical treatment decisions for you.

 

Guardianship

Questions: When may a guardianship be necessary?
Answer: If a person is unable to provide shelter, food or clothing for himself, to manage his own financial affairs or to care for his physical needs due to a mental or physical condition, then he may be found to be incapacitated and may be placed under guardianship.

Questions: Are there different types of guardians?
Answer: Yes. There is a guardian of the person and a guardian of the estate. The guardian of the estate has the duty and authority to manage the financial affairs on behalf of the incapacitated person. The guardian of the person has the duty and authority to provide the incapacitated person with housing, medical care, food and clothing.

Questions: Is it possible to select a guardian before the need arises?
Answer: Yes. Provided you are not incapacitated, you can name your guardian in the event of your later incapacity. To do so, you should execute a Designation of Guardian which must be witnessed by two disinterested individuals. The Designation allows you not only to select your guardian, but also allows you to disqualify those persons that you do not want to serve as your guardian. You may change or revoke your Designation at any time before you become incapacitated.

Questions: Who is entitled to serve as a guardian?
Answer: The court will appoint a guardian for an incapacitated person based on the following order of priority:

  • the spouse of the incapacitated person;
  • the incapacitated person’s nearest relative; or
  • an eligible person who is best qualified to serve.

Questions: What happens to my durable power of attorney once a guardian has been appointed?
Answer: The durable power of attorney terminates upon the appointment of a guardian.

 

Last will and testament

Questions: How often do I need to update my Will?
Answer: Your Will should be reviewed by a licensed attorney and updated any time that there has been a significant change in your personal life or financial situation. A significant change may be the death of a beneficiary, marriage, divorce, or if you have moved to a different state. In any event, you should have your attorney review your Will at least every five years to ensure that it is consistent with current laws.

Questions: Can I write my own Will?
Answer: Yes, but you are strongly urged not to do so. There are so many legal formalities involved in drafting your Will that you should contact an attorney to ensure that your Will is properly drafted and executed.

Questions: What is an executor?
Answer: An executor is a person appointed in your Will who is responsible for carrying out the terms of your Will. Alternate executors should also be named in your Will in the event that the primary executor named is unwilling or unable to serve.

Questions: What property can I dispose of in my Will?
Answer: Your Will disposes of all of your separate property and one-half of the community property that was acquired by you and your spouse during marriage. Your Will does not dispose of your spouse’s separate property or your spouse’s one-half interest in the community property.

Questions: How is my property distributed if there is no Will?
Answer: Texas law will determine how your property is distributed without a Will. Distribution may depend on marital status, whether there are children from a former marriage, the type(s) of property that you own at the time of death, and other factors that may be particular to your case. If a person dies without a Will, then the heirs and their respective share of the estate are determined in a heirship determination proceeding. In this proceeding, the probate court will appoint an attorney ad litem to represent the interests of any known heirs that cannot be located, any unknown heirs and those heirs that may be suffering from legal disability. For a simple proceeding, the ad litem fees alone may be $300 to $500.

Questions: Is all of my property controlled by my Will?
Answer: No. There are certain assets, called non-probate assets, that fall outside of your Will. These may include life insurance proceeds, retirement benefits and certain bank accounts. These non-probate assets are payable to the beneficiary listed on the account. The terms of the Will cannot override the designated beneficiary.

 

Probate and estate administration

What is probate?
Answer: Probate is the court procedure by which a Will is proved to be either valid or invalid. If the court approves the Will as valid, it is then admitted to probate.

Questions: What is the time period to admit a Will to probate?
Answer: Generally, a Will must be admitted to probate within four years from the date of the testator’s death.

Questions: What is involved in the administration of an estate?
Answer: Administration is the process of carrying out the terms of the Will once the Will has been admitted to probate and Letters Testamentary have been issued. Administration includes:

  • Sending the required notice(s) to creditors;
  • Filing the necessary Inventory, Appraisement and List of Claims with the probate court and obtaining the Court’s approval;
  • Collecting the assets of the deceased;
  • Paying the taxes, expenses and debts of the estate; and
  • Distributing the assets to the beneficiaries.

Questions: What is an independent administration?
Answer: An independent administration provides for the administration of an estate without court supervision. After the executor is appointed and qualifies, the court only requires that the executor provide proper notice to creditors and timely file a sworn inventory, appraisement and list of claims.

Questions: What is the difference between an independent and dependent administration?
Answer: A dependent administration occurs when the probate court selects, appoints and supervises the administrator. In a dependent administration, the court-appointed administrator must file a bond and timely file annual and final accountings. The administrator must also obtain court approval for almost every activity performed on behalf of the estate. By contrast, an independent administration proceeds with minimal court supervision.

Questions: How do I obtain an independent administration?
Answer: An independent administration can be created in the Will. The Will must contain language indicating the testator’s intent to establish an independent administration that is not subject to court supervision. If there is no Will, then the probate court can create an independent administration provided that there is agreement from all persons entitled to distribution from the estate.

Questions: What are Letters Testamentary and Letters of Administration?
Answer: Letters Testamentary are issued by the court clerk’s office as evidence of the executor’s authority to act on behalf of the estate. Letters of Administration are issued for the same purpose to an administrator who was appointed by the probate court in the situation where there was no Will.

 

Trusts

Questions: What is a trust?
Answer: A trust is a relationship created when a property owner (the “settlor”) transfers legal title to another person (the “trustee”) who has the duty to hold the property for the benefit of a third person (the “beneficiary”).

Questions: What are the different types of trusts?
Answer: There are two main categories of trusts: testamentary trusts and inter vivos trusts. An inter vivos trust is a trust created during the lifetime of the settlor and takes effect the date the trust instrument is signed. A living trust is a type of inter vivos trust. A testamentary trust is created in a Will and becomes effective upon the death of the testator.

Questions: When is it appropriate to create a testamentary trust?
Answer: Providing for your property to pass by means of a trust may be appropriate in situations where there are minor children involved, beneficiaries that are incapable of caring for themselves due to a disability, or in situations where you hope to minimize your estate taxes.

Questions: What are the advantages of a living trust?
Answer: One major advantage of creating a living trust is that it may avoid the necessity of a guardianship in the event that the settlor becomes incapacitated. A living trust is also useful if the settlor owns property in different states. After the property is transferred to the trust, then there should be no need to administer probate proceedings in the foreign state. Substantial estate tax benefits may be realized by proper use of a trust.

Questions: Does my living trust avoid probate?
Answer: Yes. If all of the decedent’s assets are properly and timely transferred to the trust, then probate may be avoided. However, if everything is not included and there are outstanding assets that were not transferred to the trust, then it is likely that the Will may have to be probated. If there is no Will, the assets will be distributed pursuant to the laws of descent and distribution after a heirship proceeding to determine the decedent’s heirs.

Questions: Should I try to avoid probate?
Answer: Not necessarily. In Texas, we have the option of independent administration of estates. Absent a Will contest or other litigation, there is minimal court involvement. You should contact a probate attorney to assist you in your decision making.

Questions: Should I be concerned about taxes?
Answer: Yes. There may be federal, state and/or local tax laws associated with the estate. You should always consult an attorney or certified public accountant prior to writing a Will or preparing any other estate planning documents.

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