Frequently Asked Questions
What is probate?
Probate is the public legal process of transferring property from a deceased person’s estate to their heirs or beneficiaries. It is overseen by the local probate court. If there is a will, the probate process will involve recognizing that will, appointing an executor or administrator and establishing a need for an estate administration. Estate Administration is the process that is used to gather estate assets, pay estate debts, expenses, taxes and ultimately distribute and retitle estate assets. If there is not a will, the process will follow the state statutes for inheritance to distribute the estate assets. Most states, including Texas and Florida, have several different procedures for administering an estate, usually based on the size of the estate and whether or not there is a will. Depending on where you live, the probate of a will generally must take place within a certain time frame within the date of death, which could be anywhere from months to years. You also generally cannot represent yourself in a probate process and you should retain counsel. You should seek an attorney experienced in estate planning and probate law.
What is a will?
A last will and testament, also known as a will, is a legal document where you can state to the probate court how your estate should be distributed when you die. The best wills are drafted with the assistance of an attorney. A will should lay out who will be named the executor (the person responsible for carrying out the will), beneficiaries (the heirs or inheritors of assets), guardianship for minors if necessary, and instructions for the executor on how and when heirs can receive their inheritance.
What is a trust?
A trust is a fiduciary arrangement that allows a third party, or trustee, to hold assets on behalf of a beneficiary or beneficiaries. Trusts can be arranged in many ways and can specify exactly how and when the assets pass to the beneficiaries. Assets in a trust may also be able to pass outside of probate, saving time, court fees, and potentially reducing estate taxes as well. The trustee must follow the instructions set out by the trust. A trust allows individuals the freedom to manage the assets in the trust in every way he/she could as the outright owner. Upon death, the management of the trust easily can be transferred to one or more individuals without the probate process. Trusts are typically created to allow more control over how and when assets are distributed, as well as save on taxes and processing time. There are many types of trusts based on specific scenarios such as marital trusts and charitable trusts.
What happens if I move to another state?
If you move to another state, you should contact your Estate Planning attorney to see what will be honored based on the new state’s laws. Generally, you will need to make updates to your wills and POA’s under new state law, but not to your trust.
What happens if I die without a will?
If you die without a will or trust, this is called dying intestate. When this happens, your estate will be distributed to your heirs according to your state’s intestacy laws. These are based on what the legislature has decided most people would want, and historical case law. No inquiry is made into what you would have actually wanted.
Are trusts only for rich people?
No, trusts are a very useful estate planning tool for everyone, especially those who wish to avoid probate or where there is the potential for minor beneficiaries. Additionally, trusts provide privacy, speed, and cost savings that cannot be found in the probate process. Furthermore, trusts allow you many flexible options for unique family situations, such as disinheriting people, managing money for those who can’t be trusted, or even managing unity among multiple marriages.
Can a Power of attorney be used after death?
No, a power of attorney ends on the death of the principal and cannot be used as a will substitute. This is why proper estate planning is important.
What is a living will?
A living will is not a will. A living will is also known as an Advance Directive to Physicians. A living will comes into effect when its creator is alive but incapacitated. It is a document that outlines someone’s wishes for medical treatment in case he or she becomes unable to communicate his or her wishes generally in two circumstances (1) due to terminal illness or (2) due to an irreversible condition (like a vegetative state). These documents can and often do reflect the individual’s unique wishes regarding life support, resuscitation and end of life care.
What is a power of attorney?
The durable Power of Attorney gives one or more persons the legal authority to act on your behalf. This authority can be as broad or narrow as you wish. This can include buying, selling, or otherwise managing your money, house, stock, etc. Powers of Attorney can be effective immediately or not until a certain event occurs (i.e. you are declared incapacitated or incompetent). Powers of Attorney may be revoked at any time. It ends upon the death of the principal and is not a will substitute. The power of attorney should be refreshed periodically to keep it current. Note, some financial institutions may not accept an older power of attorney. In fact, even if properly drafted a financial institution may not accept the document.
Does my will get changed in my divorce?
Your will does not get changed as a part of your divorce proceedings, but it can be changed during your divorce. You should contact your estate planning attorney when you have major life changes, such as divorce, marriage, the birth of a child, or significant financial or tax changes to see how they will affect your estate plan.
What is a guardian?
A guardian is a person who is responsible for someone else’s well-being. People often appoint a guardian for their underage children or for their adult children with special needs as part of their estate plan. These legal guardians can make legal decisions on behalf of their charges, much like a parent. Additionally, if you become incapacitated, you may also require a guardian to manage your assets and make decisions on your behalf. If you do not nominate someone to do this for you as a part of your estate plan, a state court will appoint someone to do it for you, which could be someone you never met. An estate planning attorney will help you plan for this properly.
Do I need to go to probate if I have a will?
In general, to have the wishes of the Will carried out, the Will needs to go through probate. Probate would also occur if there was no Will, or if there were issues with the beneficiaries. However, there are some ways to avoid probating the Will. Properly planning with the help of an estate planning attorney could set you up to potentially avoid the probate process.
Does a trust bypass probate?
If properly prepared and maintained, a revocable living trust can help you minimize the probate process as trusts do not need to be probated.
How long is a will good for?
As long as a will is properly executed, it is valid until you revoke it or replace it. For this reason, you should review it every few years to make sure it still expresses your wishes. Your estate planning attorney should keep in touch with to make sure your will remains up to date.
Is a trust better than a will?
A trust can have some benefits that a will alone does not. A trust provides the following benefits:
Privacy – If you die without a will or even with a will, your assets must go through Probate. The Probate process is open to the public, meaning anyone can look up what is going on in the process, including what assets are being probated. Trusts do not need to be probated, meaning your assets and desires are kept private.
Speed – The Probate process can take some time (possibly a year or more depending on your assets and your location), meaning your assets and loved ones’ time can often be tied up for long periods of time sorting through everything. Trusts allow the transfer of assets in a fraction of the time.
Cost Savings – The Probate process can also be expensive, taking large amounts of money out of your estate that would have otherwise gone to those you wish to inherit from you. Trusts are more expensive than wills initially but with proper planning they save your loved ones much more later, leaving more to pass on.
Incapacity Planning – Wills are not designed for scenarios where you become incapacitated because they are for after you pass away. Trusts, on the other hand, set up trustees to stand in your place in managing your assets and establish legal safeguards to help ensure your wishes are affected to the best of their abilities.
Flexibility – Everyone’s situation is different and unique. Whether you have minor children who are too young to inherit, a sibling you want to disinherit, a child you want to care for but do not trust with money, a blended family as a result of multiple marriages, or anything else, trusts offer the opportunity to pass along assets in many different ways.
How to bypass probate
In general, financial accounts such as retirement benefits and life insurance where you can name a beneficiary avoid probate, as well as trusts. Check with your estate planning attorney to make sure your accounts are set up properly to avoid probate.
Prosper Address
Janelle Creme, PLLC
900 S. Preston Rd, Ste 50 #101
Prosper, TX 75078
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Janelle Creme, PLLC
5550 Granite Parkway, Ste 270
Plano, TX 75024
Phone
(469) 714-2280