Estate Planning

Everyone knows they need a Will, but everyone struggles to get one in place.  If you have special circumstances such as a special needs child, a blended family, or a very large estate, you may need more than a Will.  Whatever your estate planning needs, we can help.  Our lead attorney, Joe Fulwiler, is board certified in Estate Planning and Probate Law and is also a CPA, so we can tackle those thorny tax issues also.

Here are some common questions that we hear regarding Estate Planning:

“Why should I have a lawyer do my Will? There are plenty of do-it-yourself kits I could use.”

The form kits for wills, living wills, etc. are very simple. That may be fine if your situation is simple: you are single, have no children, don’t have a very large estate, don’t have any special needs or disabilities, etc. But if your situation is complex, you need to have a Will (and possibly other documents) crafted to fit your situation.  There are many horror stories of people who meant to do their own Will and never managed to complete the task.  There are also horror stories of people who succeeded in getting a Will and ancillary documents (such as powers of attorney) in place but made a crucial mistake which caused the Will or ancillary documents to be unusable or to have disastrous consequences. Part of the advantage of having a lawyer draft your Will and assist you with the execution of it is that, if the Will is challenged after your death, the law firm you hired can arrange for the attorney and witnesses to appear in Court and testify that you had mental capacity at the time you executed the Will. Quite often, problems like these are not discovered until after it is too late to fix the problem.

Also, keep in mind that when you consult with an attorney, what you are paying for is not the form used, but rather the advice and counseling that goes along with it. For example, an attorney might point out that if you have minor children or may have children in the near term, you should include a testamentary trust to hold any assets they would inherit if you and your spouse both die. This avoids having to administer their assets through the Probate Court which is time consuming and expensive. It also allows you to control: who serves as trustee for them, how much is paid per month to the family who raises them, the age at which they get free rein over all of their inheritance, and the purposes for which the principal balance of their inheritance may be expended (college tuition or medical needs, for example).

Another benefit of having an attorney prepare your Will is speed.  An attorney that routinely handles estate planning can take your estate planning from start to finish quickly because they are familiar with the issues, the law, the forms, trustee options and common planning situations.

There is also the accountability factor.  People that hire personal trainers are more likely to complete their workouts.  Similarly, people who use an estate planning attorney are more likely to complete the daunting and complex process of getting an estate plan (Will and ancillary docs and any requisite trusts, property agreements, etc.) in place.

Here are some of the complicating factors that may need to be addressed in your estate planning documents:

  • children by prior marriages
  • premarital or postmarital agreements in place
  • couples that are separated but not divorced
  • large expected inheritances
  • certain family members that you do or do not want to raise your children
  • a history of discord among possible claimants to your estate
  • a desire to have someone other than your next of kin act as guardian for you if you are incapacitated
  • special needs or disabled children that will require special care
  • certain property (such as a family ranch) that needs to stay in one spouse’s family
  • the estate is large and you need to avoid unnecessary estate or gift tax liability

“Why do I need a Will?”

Getting every decision and transaction approved by the Probate Court is expensive and time consuming
If you don’t have a Will, the court chooses the person to administer your estate and monitors everything they do. This person must get the court’s approval for every action he or she takes. This is expensive and time consuming.

Your children may receive distributions at too young an age
If you die without a will, once your assets are divided according to the intestacy laws and your children reach age 18, the funds are theirs to use as they want. This could result in their inheritance being squandered, taken by creditors, or divided with an ex-spouse if they get divorced. Also, their inheritance will be managed by a court appointed trustee until they turn 18. This trustee will have to get approval from the court for everything. The expenses of this come out of the child’s inheritance. By creating a contingent trust in your Will you can appoint a trustee of your choosing and make the management of your child’s inheritance simpler and less expensive.

So that your assets go to the people you want to receive them
If you do not specify who inherits your assets in a will, the intestacy laws will govern. The chances that the intestacy laws will divide your property just the way you would have are very low.

Equal distributions to children may not be fair
If you die without a Will, and leave behind two children and no spouse, those two children will share equally in your estate. What if one of your children is 35 and a millionaire Wall Street banker, and the other is a freshman in college?

Your children’s creditors may take their inheritance
With a Will you can help your children plan around this situation.

The court will appoint the guardian of your minor children without your input
If you die without a Will, the court will appoint the guardian of your minor children without any input from you.

You may give the IRS more than you should
Intestacy distributions do not incorporate any tax planning. As a result, more assets than necessary may be diverted from your heirs into the federal and state treasury.

And don’t forget to update it!
It is important to review your Will every few years and after major events such as weddings, the birth of a child, a divorce, a change of residence, or major business events. When drafting your Will you should attempt to look ahead 3 – 5 years, and then plan on revisiting your Will at that time.

“What other documents do I need besides a Will?”

Statutory Durable Power of Attorney – allows an individual named by you to manage your financial affairs if you become incapacitated.

Living Will (a.k.a. Directive to Physicians) – lays out what medical procedures you want done to save your life and at what point you would want to be taken off of life support.

Health Care Power of Attorney – gives an individual named by you the power to enforce your Living Will and make other health care decisions for you if you become incapacitated.

HIPAA Authorization – Authorizes individuals to receive your medical information from your health care provider. The HIPAA Authorization goes hand in hand with the Health Care Power of Attorney.

Designation of Guardian – may not be necessary if you have all of the above documents, but can still be advisable if you are worried that your children may argue over who should be guardian, or if you want to advise the court of a person or persons who should not be named your guardian.

“I have more questions…”

Please contact us.

If you’re in the market for an Austin estate planning attorney, we hope you choose us.