Holman Law takes a comprehensive approach to Estate Planning. Our office reviews the information you provide and will meet with you in person or remotely (over the phone or video conference), and continue a dialogue with you during the drafting process. We make sure to listen carefully to your needs and goals, but we also don’t hesitate to ask you follow-up questions, play out hypothetical scenarios and balance the pros and cons of each potential strategy.
Our Estate Planning Services:
- Last Will and Testament
- Power of Attorney
- Medicaid Planning
- Long Term Care
- Incapacity Planning
- Veteran Benefits
Our Estate Planning services consider your individual needs for retirement income, tax liability, guardianship of children, premarital agreements, domestic partnership agreements, business planning, real estate, nursing home care, insurance, and funeral costs.
Reasons for Estate Planning
Most importantly, estate planning allows an individual’s wishes to be carried out after their death. These wishes may include leaving items or assets for loved ones, ensuring a surviving spouse will be taken care of, providing tax benefits to beneficiaries receiving assets, or leaving a legacy to a particular charity, church, or non-profit.
Benefits of Estate Planning
Creating an estate plan helps ensure an individual’s wishes will be carried out as opposed to a court determining how an individual’s estate will be distributed. An estate plan can limit the costs of administration and prevent delays in the distribution of important items and gifts to loved one. An estate plan can also reduce taxes of the individual while they are alive as well as limit tax liability for beneficiaries
At any phase of life, financial strategies can help you limit your tax liability and are unique to each individual. However, one of the most common tax benefits contemplated in an estate plan is limiting capital gains on the transfer of appreciable property – usually stocks and real estate. Other considerations include whether the estate or beneficiary bear the tax liability of transfers, effectively utilizing the annual gift tax exemption, and taking advantage of portability for the lifetime federal estate and gift tax exemption (for high net worth estates).
Qualifying for Benefits, like Medicaid
While individuals spend a lifetime investing for retirement, their retirement savings can become quickly depleted when one or both spouses require long-term care. Since the costs of this care can exceed six figures, estate plans should contemplate creating a safety net to preserve assets for the benefit of the healthy spouse and other loved ones individual wishes to provide for. This safety net is qualifying for Medicaid, which will pay the full cost of nursing home care.
This planning is recommended early since Medicaid rules to determine eligibility look at transfers made during the last 60 months. Please visit our Medicaid Planning page for more information on how to apply or re-apply and qualify for Medicaid assistance.
Review Your Existing Estate Plan
If you already have an estate plan or need to review your estate plan, other considerations may be necessary. A review will alert you to changes in the law that can require your documents to be updated. Please contact us by phone or our contact form if you would like us to review your estate planning documents.
Estate Administration is the process of inventorying assets, providing notice of the administration to all interested parties – including creditors, and ultimately the distribution of assets to beneficiaries. Whether an estate plan has been created or not, the estate of a deceased individual will need to be managed and closed out. Generally, this includes the following four steps:
- Taking an inventory of all assets.
- Giving notice to all beneficiaries and creditors.
- Paying the debts of the estate.
- Making distributions to the beneficiaries in accordance with the estate plan or rules under Texas law.
Who We Represent in the Estate Administration Process
- Beneficiaries and their interest in an estate administration.
- A Trustee or Administrator with their fiduciary responsibilities toward beneficiaries and/or the court.
- Heirs of a decedent to counsel and determine their rights under Texas intestacy law.
Beneficiaries are those who are entitled to receive assets in an estate. Beneficiaries may receive a specific bequest such as a family heirloom or a general bequest such as 50% of the remainder of the estate. If an individual passes away without a will, beneficiaries are still identified under Texas law. These beneficiaries are usually the spouse and children of the person who passed away.
Trustee, Administrator, Personal Representative
In these roles, an individual carries out the activities in an estate administration. They may have periodic reporting requirements to a trustor, beneficiary or the court. They may be liable for failing to complete certain responsibilities. An estate attorney can guide individuals through the steps involved in their particular situation and ensure their duties have been met.
Probate vs. Non-Probate
It is important to understand the difference between assets that are subject to probate proceedings and assets that are not. Generally, non-probate assets include assets held in trust, accounts with designated beneficiaries, and property held as joint tenants with right of survivorship. Upon the death, individual non-probate assets are transferred to a beneficiary or joint owner without oversight or approval from a probate court – this allows for assets to be distributed much quicker and, usually, with less cost associated with their transfer. Additionally, for Medicaid purposes, non-probate assets in Texas are not subject to recovery by the state under the Medicaid Estate Recovery Program.
Frequently Asked Questions
A: Estate planning allows an individual to direct the distribution of their assets to whomever they like – this usually has the effect of ensuring support of a spouse, child or grandchild. Estate planning can also reduce taxes that are paid by both the estate and any beneficiary who receives from the estate.
A: If a person dies without a will (known as dying intestate), then their estate is distributed according to the rules in the Texas Estate Code. It is unlikely that the inheritance rules in the Estate Code will be an exact match of how a person wished for their estate to be distributed.
A: Depending on how complex your estate is, you may want to see about avoiding probate by moving some assets into a trust. This will help avoid probate costs and potential delays in making distributions to your beneficiaries.
Also, you may be able to identify certain family dynamics that may result in issues during the administration of your estate. How you set up your estate plan may help to alleviate these concerns
A: While you may have a good estate plan, you may be named as a trustee or administrator of another’s estate, trust, or will. In those roles you have certain responsibilities to complete. You can be held liable if you fail to perform those duties. You may also be the beneficiary of another’s estate, will or trust. As a beneficiary you have certain rights that you may need to exercise if certain circumstances arise.
A: It’s a good idea to make a list of all your assets – bank accounts, investment accounts, retirement accounts, pensions, real estate and life insurance policies. It is also helpful to have a general inventory of your personal belongings – especially if any items have significant cash value or personal value (for example, a china set that has been passed down for multiple generations). Your attorney may have a questionnaire or intake form than can help you get started.
You also should be thinking about any goals – leaving money or property to certain people, charitable donations, etc. All of this information will be helpful for the attorney to provide the client with good estate planning options.