Estate Planning Attorneys in The Woodlands: Stilwell, Earl & Apostolakis, LLP

Estate Planning, Wills and Trusts

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In Texas, if you die without a will, the state of Texas has one for you. Unfortunately, that’s not always what you want to happen, especially in the situation of a blended family. Generally speaking, if there’s not a blended family, it will go to the surviving spouse. However, if there is a blended family with children outside of the marriage, it can complicate things significantly. This is because the community property of that marriage will go to the children outside the marriage. If there are children both from outside and inside the marriage, all of those children will inherit, and the surviving spouse will not receive the community property.

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Usually, a valid execution of a will requires two witnesses and a notary to sign at the same time as the testator or the person whose will it is. In this area, we actually tried a trial, won the case, and won on appeal—the case that determines how those Witnesses, the testator, and the notary must interact at the signing. Once you leave this area, we don’t have that level of protection, and there’s some uncertainty in Texas. But in this area, thanks to the case we tried, we know.

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A person who becomes incapacitated loses the ability to manage their property and make decisions regarding it. In such cases, they require a surrogate to act on their behalf. The law offers two choices: designating a person as a power of attorney, a space that tends to be relatively unregulated and uncertain, or having, for example, the trustee of their revocable living trust manage their assets. The latter option is by far the better choice for someone who loses capacity. Having a revocable living trust in place with a trusted friend or associate as a trustee ensures that their wishes can be carried out effectively.

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A trust is a very durable estate planning device. It can achieve any number of tax results that the client wants. It can protect money left to children from judgment creditors and from Divorce Court judges. It can also structure payouts to kids that are not strings from beyond the grave but are, in fact, very similar to decisions that parents would make if they were still around. Trusts can also pass down to grandchildren.

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When we talk to our clients about trusts, there’s generally two big categories that we talk to people about. We talk about trusts that are inside of a will and we talk about trusts that are freestanding from a will.

So first on trusts that are inside of a will: if people have children that haven’t turned 18 yet, frequently if something happened to the adults, they wouldn’t want their children to have the money quite yet. The children aren’t quite ready, and so we frequently do trust for minors inside of Wills to help look after the money until the person is old enough to take care of the money themselves.

We also sometimes do a similar type thing for people with special needs. So if they are unable to take care of things themselves but for a different reason than age. A third type of trust that we sometimes do inside of a will is for someone that has capacity issues, Alzheimer’s or dementia, or some other kind of mental health condition that prevents them from really being able to look after assets and take care of things themselves.

Other types of trust that we do, and some can be inside of a will and some can be outside, are for tax planning purposes. So if people are in a wealth situation where they are subject to federal estate tax, then we try and set up a trust for them that helps minimize the amount of taxes that they would pay.

The last kind of trust that I mentioned is trust outside of a will. We call those revocable living trusts, and those have become more and more popular over the years for people that are trying to handle all of their probate while they’re alive. That is, transfer all of their assets into a trust now so that when they die, they can try and avoid probate altogether.

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Most people need a document to state what their wishes are going to be. So, the first one that people think of naturally is a will, but sometimes we also use a trust as an alternative to a will. A will or a trust is the first thing. Beyond that, there are the documents that I say are planning for the living. That is, if you get sick and you’re unable to make decisions for yourself, you need a health care power of attorney. Likewise, if you’re unable to make decisions for yourself, you need someone who is identified to be able to make decisions for you on matters other than health care. That document’s called a statutory durable power of attorney, and it covers pretty much everything that you could do if you were ready, willing, and able to do it.

Additionally, when people have minor children, we talk to them about signing a guardianship document. That is a document to name a guardian in case something happens to them and they’re no longer able to be the parent for their parent. Beyond that, we also frequently talk to people about their beneficiary designations to make sure that in conjunction with their will or their trust, their assets that have beneficiary designations on them go the way that they want them to go to the people that they intend to have them.

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When people approach us after a loved one has passed away, they often seek guidance on what needs to be addressed in the probate process. Typically, I begin by discussing life insurance. Life insurance policies typically have beneficiary designations, and assets with these designations usually do not require probate proceedings.

Similarly, individuals with retirement assets like 401(k)s or IRAs often have designated beneficiaries. These assets, too, typically pass outside of probate through the contract associated with them.

Many people are unaware that they can designate beneficiaries for various assets. For instance, my wife and I have even designated beneficiaries for our bank accounts to ensure a smooth transfer of those assets to the survivor. In Texas, it’s even possible to designate a beneficiary for your car.

In recent years, it has become increasingly popular to put a beneficiary designation on the deed of one’s house. This can be particularly advantageous, as a house is often the most substantial asset an individual owns. Having a beneficiary designation on the house deed ensures that the property can be transferred without the need for probate proceedings, making the process more efficient and less burdensome for loved ones.

What is right for me - a will or a living trust?

Do I need other documents in addition to a will or a trust?

What happens if I become ill or have an accident, but do not die?

We can help with your estate planning and prepare documents to plan for your future needs, including:

Empowering someone to make medical and financial decisions for you, if you cannot;
Identifying who will receive particular assets;
Specifying who will be in charge of carrying out your wishes;
Minimizing estate taxes;
Simplifying the transfer of your assets after you die;
Stating what you would like to occur if you have a terminal or irreversible medical circumstance; and
Helping you have peace of mind that your wishes will be carried out.

Because everyone's financial situation is different, our firm provides a confidential initial consultation on a complimentary basis to help you determine what combination of estate planning documents are right for you and your loved ones.

For more information about estate planning, wills and trusts, please see our “FAQ” or Frequently Asked Questions.

Attorneys Who Serve This Practice Area

*Attorney Robin Apostolakis is Board Certified in Estate Planning and Probate by the Texas Board of Legal Specialization.