Livens & Reed, PLLC

Dallas Estate Planning Law Blog

Advance directives are a vital part of estate planning

Taking steps to provide for and protect loved ones is a noble effort, but who will be there for them if something happens? Texas residents need to consider what will happen to them if they become incapacitated or otherwise unable to make decisions for themselves. By including advance directives into the estate planning process, both the individuals doing the planning and their families can enjoy some peace of mind.

These documents tend to work together to provide certain protections to an individual unable to protect him- or herself, most often due to an injury or illness. A living will allows an individual the chance to outline his or her preferences when it comes to certain medical treatments, especially if the person becomes permanently unconscious or terminally ill. For instance, many people do not want to be resuscitated under certain circumstances. A DNR, as it is called, could be part of a living will, among other things.

Probate is not always easy for an executor

Dealing with disputes and challenges is not always what someone imagines when he or she accepts the duty of being executor of a loved one's Texas estate. Most may imagine the executor as the one who doles out the assets according to the wishes of the deceased. However, along with the many and sometimes complex responsibilities, an executor often takes on considerable risk from the earliest days of the probate process.

Two heads are not always better than one, and a testator who names two or more individuals to be co-executors may be leaving these individuals with trouble. Working as a team is not always possible, such as when one executor lives in another state, when one has few financial skills or when one is not willing to cooperate with the other. However, even when working alone, an executor may face conflict.

An inheritance is not always a guarantee

Receiving assets from a recently deceased loved one can often seem like a blessing. The inheritance could allow a person to still feel connected to his or her loved one, or it could help an individual handle a difficult financial spot. Of course, even if individuals anticipate receiving assets, it is important to remember that it may not be a guarantee.

Hopefully, Texas residents will have discussed estate plans and other related matters with their family members before the time comes to implement the plans. This could allow interested parties to have a better idea of what to expect when it comes time to probate the estate. After all, a person may expect to receive a windfall after a loved one's passing only to find out that he or she had been disinherited.

Why having a will is not always enough

Estate planning is important, which most adults in Texas can probably agree on. Agreeing on what should go into those estate plans might be a little more difficult. This is partly because everyone's estate planning needs are different. However, it is important to not make assumptions about one's own needs, especially if an estate plan only consists of a will and nothing else.

When a person passes away, his or her will has to go through probate. During this legal process, assets are supposed to be distributed according to the will. This can be a time-consuming process even in the best circumstances, but there are often complicating factors. For example, someone can choose to contest a will. This could end with that court going against the deceased's wishes.

Is medical debt a priority during probate?

When a person dies, the surviving family often has a lot to handle in order to close the remaining estate. Often, the majority of tasks associated with probate fall to the executor of a Texas estate. Though many bills may need paying after a loved one's passing, some parties may wonder specifically about medical bills.

It is not unusual for individuals to pass with outstanding medical bills, especially if a person was in the hospital or otherwise ill before his or her passing. If the individual left behind a solvent estate, the executor will use estate funds to cover the remaining medical bills and other outstanding balances. Even with a solvent estate, it may be necessary for the executor to liquidate some assets in order to cover claims made by creditors.

Interested in a Ladybird deed?

Do you have a loved one who will likely need long-term care in the years to come? Many Texas residents end up in this position, but they often lack the funds they need to pay for this type of care -- which can cost thousands a month. The state offers something called a Ladybird deed, which may help those needing LTC to afford it.

Typically, when a person goes to apply for Medicaid for long-term care needs, the government can look back five years to see what assets he or she had, or moved, in order to qualify. This means, if LTC planning is not done early enough, one's Medicaid application may be denied. Of course, planning too soon once resulted in people having to leave their homes and live with relatives just to make it look like they lacked assets.

Advice for those whose inheritance includes a Roth IRA

Retirement plans can have several different components. They not only take care of an account holder, but can be passed on to a family member or another individual after the account holder has passed on. Some of them include a retirement account known as a Roth IRA. When this type of retirement account is part of an inheritance, the beneficiary may have many questions about what to do with it. Fortunately, experts have several helpful suggestions for anyone here in Texas in this situation.

The SECURE Act, signed into law last year, made changes to the inheritance of an IRA. The accounts must be emptied within 10 years of the original account holder's death, unless an exception applies. For example, if the IRA is given to the account holder's spouse, or if the beneficiary is disabled or chronically ill, that rule doesn't apply.

Living trusts can have various benefits depending on the type

When looking into estate planning options, some Texas residents may want to rearrange some of their assets. Living trusts can help them transfer ownership of those assets before their passing and help give them more control over the distribution of those assets later. Plus, trusts can lessen the delays that beneficiaries may encounter when waiting on their bequests.

When creating a living trust, the trustmaker will need to decide whether it should be revocable or irrevocable. Some parties choose a revocable trust because they still have the power to change the trust while they are alive. However, because the trustmaker still has that power, it means that the assets are not fully removed from his or her estate and are still vulnerable to creditors and estate taxes.

Still possible to make estate planning resolutions for 2020

It's not easy to think about things that could happen in the future, and for this reason, it's common to delay the process of getting certain plans in place. Estate planning may seem unnecessary for those who are young, in good health and/or with moderate assets, but it is actually a beneficial step for everyone. For this reason, all Texas adults may want to use the start of a new year as an opportunity to craft a plan that suits their needs. 

One recent poll found that as many as three in five people do not have estate plans. When a person dies without a will, state laws will determine what happens to his or her estate. This can make things especially frustrating for loved ones and heirs left behind. A basic first step in the estate planning process is to simply think about goals for the future and what fears may be holding someone back from drafting documents and discussing these things with family members.

Stepparent handling estate administration may concern children

When a loved one does not make end-of-life preparations, it is easy for issues to come about among the surviving family. Some family members may realize that there is a chance for problems before their loved one's passing, but due to mental decline or other issues, the person is unable to create an estate plan. As a result, Texas families may be left to find the best way to handle estate administration and any resulting conflict.

In many cases, stepparents can cause biological children to have concerns over their biological parent's estate. If the biological parent did not create an estate plan, those concerns may be even greater. In some cases, a stepparent may claim everything relating to the estate and tell the children that they get nothing. However, that is not how the process has to play out.


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