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Dallas Estate Planning Law Blog

In estate planning, legal directives execute the maker's wishes

Because an estate plan in Texas and elsewhere consists of a variety of “legal instruments” that must pass muster under state law, it’s best to give up any thoughts of doing them yourself. Consider working with professionals to get your estate planning done as a classic ‘team effort’ geared toward accuracy and legal compliance. It’s true that estate planning also seeks to maximize the value of the estate’s assets, and to minimize tax drains, and these efforts are included in the process.

The power of attorney is usually an indispensable tool in the arsenal of estate planning documents. This is a document in which a person, the principal, confers a certain authority in a second person, an agent, for the agent to sign the principal’s name and to do basic acts of business and conduct affairs on behalf of the principal. The power of attorney can authorize a wide range of actions, and it should be drawn up to carefully designate which powers are being conferred.

Estate planning allows targeted action regarding children

One important benefit of estate planning in Texas concerns the treatment of minor children. By proper estate planning, people can say who will take care of their children if the need should arise, and they can also appoint a trustee for the money and assets left for the children. If this is not done prior to death by will or even in life through living trusts, the court may appoint a guardian to exercise custody over minor children and a guardian or conservator to take control of the children’s money.

If a person does not provide for the desired appointments to take care of the children’s needs, going through court proceedings to have persons appointed can be long and expensive, especially if disputes or conflicts arise. Indeed, the court does not always appoint someone whom the disabled person, the decedent or the family would approve. A court appointee is often a stranger who has no background in understanding the decedent’s life or circumstances. A court appointee does not always turn out to be an entirely helpful influence in the process.

Business owner may need estate planning with funding

A perception exists, in Texas and elsewhere, that estate planning is about avoiding taxes, but in fact it goes beyond that into even more fundamental issues of how to preserve and protect one’s estate. With respect to federal estate taxes, currently a married couple must have a combined estate over $10.6 million before exposure to a federal estate tax. Additionally, an individual should worry about income taxes during life prior to considering estate planning for a death tax. Income tax rates for a business owner, for example, can be as much as 50 percent under certain circumstances.

For a business person, it is the business during life that is the number one concern – it must be preserved in several key ways, or there will be no estate to plan. Where a small business is dependent on its founder, his or her disability or inactivity can depreciate the value of the business quickly. Thus, it is vital in many cases for the person preparing an estate plan to first focus on insurance and risk management so that the estate corpus can be protected from destruction.

Estate planning today also accounts for digital assets

In Texas and worldwide, the technology revolution has caused many old paradigms to fall away in the face of changing abilities and opportunities. In estate planning, a new area of digital assets is becoming more defined, while rules and procedures to appropriately process these assets during life and after death are developing. The estate planning process now includes making sure that one provides for the administration of his or her digital assets as well as the more traditional ones.

Some digital assets may have sentimental value only, whereas others may have economic worth. They may include photographs, personal poetry or books, family histories and ancestral trees, along with online bank accounts, PayPal accounts and other financial records. Other assets may include social media pages, domain names, bill payment services and records, email records and other miscellaneous items.

How is estate planning different for women?

Men and women alike could benefit from estate planning. The tools and strategies available for men and women are roughly the same, but there are often special elements in estate planning for Texas women to consider for retirement. A report by the United States Census Bureau suggests that the amount of widowed women over the age of 65 is at 36 percent.

One item to consider is that women are prone to outlive men and fail to notice what may happen if their family or husbands die, especially since only 12 percent of men who are over the age of 65 are widows. Women are often in a challenging situation in retirement if a majority of the income was from the husband and retirement benefits end upon the husband’s death. Women may want to look into their income when creating their estate plan, including death benefits and possible VA benefits.

Same-sex estate planning in Texas

Whether a person is single or married, an estate plan is an important tool to ensure that wishes are carried out after death. Understandably, many Texas couples choose to have their spouses listed in their estate. Same-sex couples, however, may have complications when it comes to creating their estate plans.

Since laws are different, depending on their jurisdiction, same-sex couples may find it challenging when planning their finances. In these jurisdictions, there may be different labels for the couples, such as domestic partnerships or same-sex civil unions. It’s recommended that couple keeps accurate financial records and enter into prenuptial agreements, just in case divorce should happen in the future.

Do-it-yourself estate planning in Texas may not be good idea

There are many people who would like to save money on estate planning services. Due to this, a number of Texas residents utilize do-it-yourself web sites to create wills and other estate planning documents. While this can be cost-effective, blunders can occur that can cause disaster in the long run.

A woman used a web site to create her will and instructed for some property to be given to her sister. If her sister passed on before a certain time, then her brother would be next in line to receive the property. When the will was created, the form did not include a clause for all property that was not specifically gifted. The sister eventually died and the woman was left with money and property.

Estate planning for the younger crowd in Texas

Age does not matter when it comes to planning an estate. Nothing is guaranteed in life, and estate planning can help surviving family members to be more at ease when handling affairs. Even for Texas residents who feel that they do not have many assets, having an estate plan can still be crucial.

A 23-year-old man with no children met with an untimely death. He was separated from his wife but failed to have a will in place. Since he had no will and his insurance had not listed a beneficiary, the state took up the matter, leaving his parents with none of his assets. It’s also important for those who have children to have an estate plan and have a serious conversation with family members about issues that could happen in the future.

Will is an important part of estate planning in Texas

Creating a will might not seem fun -- it might even seem painful -- but not having a will may be even more painful for family members in Texas. This is because the lack of a will means that one’s estate has to go through an administration proceeding in probate court. When that occurs, a decedent's assets are distributed by statute by the laws of intestacy. In that event, the estate's assets may not be divided as the deceased individual would have wanted.

In addition to the importance of creating a will, it is also important to update the document. The document could use updating if a person gets married, separated or divorced. In addition, one may wish to revise the will if a birth, death or relocation takes place. After relocating, it’s necessary to make sure that one’s estate executor and power of attorney are still able to handle these duties. When a person moves to a new state, it may be necessary to list a different estate executor who can handle the job locally.

Digital assets should be included in Texas estate planning

Understandably, most people do not want to discuss their own death. However, death is unavoidable, and surviving Texas family members stand to benefit more when estate plans are in place. Since the internet is a very powerful tool, most people have social media accounts and online bank accounts. Apart from tangible property such as homes and jewelry, it’s also important to include digital assets in estate planning.

A research firm released a survey that reveals that over 50 percent of individuals do online banking. Another 32 percent of individuals use their cell phones for online banking. With the internet being a primary storage unit for a lot of information, digital assets have financial value to loved ones. Since these digital assets hold value, it’s vital for this to be included in estate planning documents. Individuals will need to locate the digital assets and take inventory.

Our Office Locations

The Livens Law Firm
2516 Harwood Road
Bedford (Fort Worth), TX 76021
Phone: 817-545-3425
Toll Free: 800-569-2663
Fax: 817-545-9847
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Austin Office
3 Lakeway Centre Court
Suite 120
Austin, TX 78734
Phone: 800-569-2663
Fax: 888-545-9847
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Addison Office
14135 Midway Rd.
Suite G-250
Addison, TX 75001
Phone: 972-685-5202
Fax: 972-685-5606
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