FAQs - Estate Planning
- Do I Need a Will?
- Can I Draft My Own Will?
- How Can I Avoid Probate?
- Management Trust (aka Standby Trust or Intervivos Trust) versus a Will
I recommend everyone have a Will, especially if you have real property or other valuable assets. Additionally, if you are married or have children, a Will is important to make sure your assets are distributed to the person you want.
- Cautionary tale. A client came to me after her husband had passed away. The couple had been married for several years. He did not have a Will and he had a son with another woman long before he ever married my client. That son was never part of his life. Since the husband did not have a Will, Texas law states his one-half ownership of community property must be given to the son. Texas law also states that most of his separate property be given to the son as well.
You can draft your own Will; however, it is not recommended. If the Will does not have certain instructions or is not executed property, it will cost your estate much more money to probate the Will than it would cost to have an attorney draft the Will for you.
There are ways to avoid the cost of probate, which we can discuss in our initial meeting; however, it is important to know that probate in Texas is much easier and less expensive that in most other states. The articles in the newspaper that tell you to avoid probate by getting a management trust are typically from California where probate is very expensive and very complex. That being said, management trusts are very useful and I would be happy to discuss the various options to avoid probate with you.
A trust is a legal entity that holds your assets while you are alive. A trustee manages and controls the assets in your trust for your benefit. You can be the trustee of your own trust. Upon your death, the trustee distributes the assets in your trust to the beneficiaries you name in your trust or may you can require the trustee keep the assets in trust for the benefit of the beneficiary (i.e. protecting the beneficiary from creditors or the event of divorce). Since the trust is its own legal entity, it is required to file an income tax return each year if it earns enough income. A trust can be terminated or amended if it contains language in it that allows for its termination or revisions.
A Will only goes into effect at the time of your death and it must be filed for probate in order to transfer your probate assets. You may change your Will any time before you die (as long as you have the legal mental capacity to do so). Your Will should appoint an Executor to serve independent of expensive court supervision. Your Executor is required to collect your probate assets, pay your debts, and distribute your remaining probate assets to the beneficiaries you designate in your Will.
To discuss any of the above questions or any additional questions, please contact Maverick Law to schedule an initial consultation.