Transcript Estate Planning Made Simple

Trust, Wills & Probate
Ricky Villarreal
Attorney at Law
281-793-7262
WWW.MYTEXASWILLS.COM
Outline
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What is a Will & Why do I need a Will?
What is Probate?
Do I need a Trust or just a Will?
Are there any other documents that I need?
What should I have in my Estate Plan?
What is a Will & Why Do I Need a Will?
– Generally, the Will covers:
• Who will handle your estate.
• Who inherits your assets.
• Who takes care of your kids.
• Who takes care of the inheritance you left the kids.
– Without a Will:
• The court will follow Texas Law to help decide how
to transfer your assets, and who care for your kids and
their inheritance.
• Dying without a Will burdens your family with extra
legal expenses, issues and paperwork.
Comparison ...
Without a Will
With a Will
Court approves Executor
You select Executor
Distribution of the assets is
generally delayed.
Quicker
Higher Probate Cost
Lower Probate Cost
Less $$ to your family
More $$ to your family
Guardians and Trustees will
need to approved by the court.
You pick the Guardians and
Trustees.
What is Probate?
• Probate is the process of executing your wishes as you have
documented in your Will.
– Here’s a general outline of the Probate process:
• Find the Will
• Hire Attorney
• File Application for Probate
• Attend Probate Hearing with your Attorney
• Manage affairs of the estate (pay bills, distribute the
assets, set up living arrangements for the children, etc.)
What is Probate?
• At the Probate hearing, you will need to:
– Provide testimony regarding the estate,
– Take an oath to execute the terms of the will,
– Receive permission to to manage the estate.
• After the hearing, your duties are generally:
– Provide “Notice to Creditors”
– Pay bills and deal with creditors.
– File “Final inventory and list of claims”.
– Transfer assets.
– Set up arrangements for care of the children.
Do I need a Trust or just a Will?
• Recall that the Will provides for
transferring your assets and taking care of
your kids, but requires going through the
probate process.
– Many times, the executors have a
difficult time trying to identify the
assets.
– Your loved ones will have to do this
after suffering your loss.
Do I need a Trust or just a Will?
• The Trust:
– Pros:
• avoids probate,
• allows your appointed representative to handle your affairs
and pay your expenses if you are incapacitated,
• can allow significant tax benefits for wealthy estates.
– Cons:
• You will need to take action now to move your assets into the
trust.
– Generally, for financial accounts, you will need to contact
your institution to determine how to move that account
into the trust.
– For your home, a Warranty deed must be filed.
Do I really need to have a Trust?
• To ease the burden on your loved ones, you should add a
Trust to your estate plan.
– The front-end effort is more involved, but only to the
extent that you need to retitle your assets.
• This has the advantage of forcing you to document
your assets for your trustees/executors.
• The day-to-day management and use of your assets
doesn’t change, since you are the Trustee and have
full authority over the assets.
– The back-end effort is significantly reduced, since your
trustees/executors now have knowledge of your assets
and can execute your wishes without going through
probate.
Are there any other documents that I need?
• To complete your legal estate plan, you should also have:
– Medical Power of Attorney
• appointing your representatives to make medical
decisions for you if you are incapacitated.
– Durable Power of Attorney
• appointing your representatives to make business
transaction for you beginning immediately or upon
your incapacity.
– Living Will
• directs your Physician on your wishes for treatment if
you are incapacity and your death is imminent.
What should I have in my Estate Plan?
• At a minimum, your estate plan should consist
of the following:
– Medical Power of Attorney,
– Durable Power of Attorney,
– Living Will, and
– Will.
• To significantly ease the burden on your
family, you should also add a Trust.