You've worked hard for everything you have. Don’t you want to have a say in what happens to your property once you’re gone? This is especially important if you have children, special needs heirs, or an unconventional family arrangement. You can accomplish this through documents such as a will, or a will combined with a trust. There may come a time that you suffer from a severe illness or injury or become physically or mentally disabled. There are estate planning tools that allow you to decide who can make certain financial and medical decisions if and when you are no longer able to make them for yourself. They also make it easier for the person you charge with making such decisions to carry out your wishes. These tools include the durable power of attorney, medical power of attorney, directive to physicians, HIPAA release and designation of guardian. Or your goal may be probate avoidance. This can be accomplished with other tools such as beneficiary designations, payable on death provisions, and transfer on death deeds to name a few. You have the right to determine what happens to you and your property. Exercise that right.
Estate Planning Tools
Here are a few of the more popular estate planning tools available.
Will: What does a will do? In a will, you state who you want to inherit your property and name a guardian to care for your young children should something happen to you and the other parent. If you die without a will, it is called dying intestate and the Texas statutes would then determine how your property will be divided.
Durable Power of Attorney: Why do I need a durable power of attorney? A durable power of attorney gives someone you trust the power to act as your agent to make financial decisions and/or other legal decisions on your behalf if and when you cannot make these decisions on your own. Often people believe that they do not need a power of attorney if they are young and healthy. Illness and injury can occur in an instant, and if suddenly struck, you will need someone that you trust to handle your affairs when you cannot.
Medical Power of Attorney: Why do I need a medical power of attorney? A medical power of attorney gives someone you trust the power to act as your agent and make medical decisions on your behalf if the time comes when you cannot make these decisions on your own.
Directive to Physicians: If I have a medical power of attorney, why do I need a directive to physicians? A directive to physicians spells out your preferences concerning certain kinds of life-sustaining treatments. Often families are faced with these difficult decisions and once a decision is made, resentment of the person who made the decision can arise. The directive to physicians allows you to make these decisions for them if such need arises, making it easier on your loved ones.
HIPAA Release: What is a HIPAA release and why do I need one? HIPAA is the Health Insurance Portability and Accountability Act. This law protects the confidentiality and security of healthcare information. Health care providers are extremely cautious when releasing this protected information. Although the medical power of attorney should be sufficient, an attending physician must certify that you are incompetent before a health care agent has the authority to act under a medical power of attorney. You may want someone to have access to this information before that time. Additionally, health care providers sometimes err on the side of caution if the power of attorney does not include certain language. It is better to cover all your bases.
Declaration of Guardian in the Event the Need Arises: If you have a minor child, naming a guardian is important in such case that both parents pass away. You can also protect yourself with a declaration of appointment of guardian in such case that someone tries to obtain a guardianship over you one day. This adds an additional layer of protection to your powers of attorney.
Trust: Do I need a trust? In Texas, probating a will is not as burdensome as it is in many other states. If you want to create a living trust to avoid probate, you are basically doing all the leg work ahead of time. If by chance you forget to fully fund the trust (put everything in the trust’s name or the trust as a beneficiary) then you will end up having to probate the pourover will (will that leaves everything you may have missed to the trust). So when do you need a trust? A trust can be useful in many situations including (1) if you own property in another state; (2) you have a blended family; (3) you have a special needs child or family member that you wish to make a beneficiary; (4) you have minor children; (5) you have adult children that are not financially responsible; or (6) you want to control what happens to property after your death. These are just to name a few. For more information about what a trust can do for you, contact our office.