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There are often misconceptions about estate planning that you should know when preparing your documents. Estate planning serves to provide your family and loved ones with protection upon your passing, regardless of your wealth or assets. Your will should let your loved ones know how you want your assets to be divided. A court cannot make decisions on your behalf about what happens with your property, accounts, or guardianship of your children. If you have a trust to avoid probate and distribute assets, the process might be easier for all parties involved. How Does Dementia Affect Estate Planning? Dementia may affect estate planning, as the person suffering from this illness loses the ability to think clearly which could significantly impact their legal and financial decisions. Usually, friends and relatives close to someone suffering from dementia will need to help them make decisions. You can write a power of attorney document to state that someone close to you can make decisions on your behalf. To avoid probate, you may want to place your assets in an individual revocable trust for your children. What Happens If a Patient Is Not Able to Create a Will? When creating a will, a patient usually has to prove they are capable of decision-making. This is judged by the testamentary capacity of the patient, meaning that they know the type of property they have, the natural objects of the property, what details they are putting in their will, and the ability to form a concrete plan for their estate. If a patient cannot create a will, the court will make decisions on their behalf  in the event of their passing. The estate then goes into probate. If a patient passes away without a will, the state’s laws determine the distribution of the person’s assets. Speak With an Attorney About Options for Estate Planning There are many myths about estate planning out there that could complicate what you are trying to accomplish. If you have not made any official estate plans, reach out to the Your Legacy Legal Care and speak with an experienced estate planning attorney to ensure your assets are covered and allocated to your loved ones. Contact us today!

In order to create a comprehensive estate plan, it helps to be familiar with your state’s laws and regulations. Of course, that is easier said than done – especially if you live in the great state of Texas. The Lone Star State presents a number of unique challenges when it comes to estate planning. While only an experienced estate planning attorney can give you specific advice about Texas’s laws, it is helpful to stay in the loop about the following quirky regulations: Community Property Laws Texas is one of the nine states that follow community property law. All assets acquired by a couple during their marriage will be considered “community property,” regardless of which person made the purchase. Houses, cars, and pets are all owned by Texas spouses in a 50/50 breakdown. When one spouse passes away, they can leave their share of assets or property to whomever they would like, but things can get complicated when it comes time to distribute the estate. For instance, say John purchased a house in Austin a year into his marriage to Rebecca. While John purchased the home himself, both he and Rebecca own 50 percent of the property under Texas’s community property laws. Each spouse must plan out in advance what they would like to do with their portion of the house. Many people are surprised to learn that there is no law in Texas that allows a spouse to automatically inherit the deceased spouse’s portion of their joint assets. Without a will in place dictating their preferences, the court will decide how assets should be distributed. Dynasty Trusts The perks of a dynasty trust for long-term wealth planning are significant. Dynasty trusts allow Texans to combine protections against divorce and creditors – as well as tax savings – with a long or even unlimited duration. This makes them an invaluable tool for estate planners. A new law allows these trusts to exist for up to 300 years. Effective as of September 1, 2021, the new law allows trusts to be active for centuries to come. Of course, there are some exceptions to the rule. Charitable trusts are not subject to durational limitations. The new law also includes a provision that precludes trusts from being used to tie up a real property asset for periods of longer than 100 years. When weighing a dynasty trust for your family, explore the perks of using a corporate trustee. Unlike individuals, corporations don’t die. A corporate trustee can offer professional management skills and understand trust laws in ways a friend or family member simply cannot. When properly drafted, dynasty trusts are like having a family back for your descendants to rely upon for generations. The Intestacy Statute The State of Texas has written a will on your behalf. Fail to create an individual estate plan, and you will have no say about how your assets will be distributed. Dying in Texas intestate – or without a will – means that the state will apply a standard set of rules to the distribution of your property. The most important factor in determining who gets your assets is marriage. A married intestate decedent will usually have all property transferred to their surviving spouse if all of the children are of the marriage. Kids play a role, too; spouses and children usually split the estate evenly. State laws complicate the process significantly. In all cases, it is best to have a will or estate plan in place to dictate the distribution of your property instead of relying on intestacy. Even if you are comfortable with how you believe the state will divide up your property, laws can change. Leaving your family’s future in the hands of the government could end up being a costly mistake. Speak with a Knowledgeable Estate Planning Attorney No matter your life goals, it is important to make thorough estate plans. Speaking with an experienced estate planning attorney can help you navigate Texas law while setting up the brightest future possible for your loved ones. Schedule your estate planning appointment now by calling (281) 218-0880 or schedule online here. #Intestacy #estateplanninglaw #CommunityProperty #texas #dynastytrust

In Texas, a person can be appointed as a guardian under two circumstances. The first circumstance is if a minor loses a parent. When both parents are deceased or even when one parent is deceased, you can file for guardianship over minor children. A guardian will have guardianship of the minor until they turn 18. The second circumstance, which we see more in our office, is when someone is incapacitated. When an individual cannot take care of themselves and make decisions, they need someone to help take care of them. Most of the time, they cannot do normal daily living activities. They are unable to handle their finances, make medical decisions, dispense medications, and they may make bad purchases. In other words, they cannot live on their own. What Happens If a Guardian Is Not Appointed and a Situation Arises Where One Is Needed? Usually, with a minor, when a parent is lost, if there is another parent in place, that parent takes over as the natural guardian of the child. However, that parent is not the natural guardian of the child’s estate. If a child inherits money because he or she lost a parent, then a guardian of the child’s estate must be appointed. In such cases, we frequently recommend a management trust to avoid annual accountings, which is less than the cost of a guardianship. When an incapacitated person is involved, a guardian must be appointed if there is not a properly executed power of attorney in place. If the incapacitated person does not have family or family that sees them regularly, there is potentially no one to make every day medical decisions or handle their finances. If no one is in place to ensure that the bills are getting paid, they are getting medications, and being taken care of, it puts that incapacitated person at risk for harm. Is a Guardianship the Same as a Conservatorship in Texas? In Texas, a person becomes a guardian in probate court. Other states use the term conservator, which you may be familiar with from Britney Spears’ conservatorship dispute. In Texas a conservator is someone, usually a parent, that is appointed in family court. If you lost one parent, you may have the option of going to either court, but if both parents are deceased, then you will be going to probate court for guardianship. Does The Child Need a Guardian and a Conservator? A child does not need both a guardian and a conservator because they are basically the same thing under two separate areas of law. Having said that, a person could be the conservator of a child, like a parent, but that person may also be the guardian of the estate of the child. Sometimes, a person may serve in both roles, but most of the time, the roles are separate. Can I Transfer a Conservatorship to a Guardianship for a Special Needs Child? In family court, a conservatorship cannot be transferred because once the child turns 18 they are considered an adult. If the individual is a disabled child that cannot take care of himself or herself, and they fall under the criteria to have a guardian appointed, then the guardianship would start from the time the child turns 18 and continue throughout adulthood. Family court takes care of minor children, and when the child becomes 18, they then switch to probate court under the guardianship at that time. What are the Responsibilities of a Guardian in Texas? A guardian is required to make sure that the child or adult has all the things they need to live. For instance: a clean home, food, medicine, and clothing, as well as making sure that there is someone to stay with them if they cannot live on their own. If an older person needs a guardianship, the guardian is required to see the ward a minimum of once every 30 days. The guardian could be responsible for handling finances every year, which would require them to do an annual accounting and filing this with the probate court. If they are not handling finances every year, they must do an annual report for the court that gives very detailed information about the ward. The guardian is required to inform the court on the ward’s health, their living arrangement, and how they are doing overall. The judges read this report, sign an order approving the report, and allows the guardian to obtain their letters of guardianship for another year. For more information on being appointed a guardian in Texas, scheduling a strategy session is your next best step. Get the information and legal answers you are seeking by calling us today to ensure your loved one is taken care of.

Are you a beneficiary of a retirement account? If you’re here, you may be in the process of inheriting an IRA retirement account from your parent or other loved one. Or maybe you’re wondering what it means to inherit an IRA and what your options will be in the future. No matter what stage you’re in, it can be overwhelming to navigate the complexities of inherited retirement accounts. From understanding the tax implications to making smart investment decisions, you need the help of an experienced estate planning attorney to ensure your inheritance is beneficial instead of burdensome to you and your family. At Your Legacy Legal Care™, we want to help ease the burden of figuring out the complexities of inherited retirement accounts so you can rest easy knowing your loved one’s legacy is honored, and your financial future is secured. What Are Inherited Retirement Accounts? Inherited retirement accounts are financial accounts that pass from one person to another when the original account holder dies. Examples of these accounts include IRAs, 401(k)s, and pension plans. In most cases, the beneficiary of the account will receive the assets and become the new owner of the account. Beneficiaries have a number of choices when it comes to distributing the funds in the account, many of which are subject to income tax and other penalties. This, of course, depends on the type of account and the person inheriting it. Rule #1: Your Choices for Inherited IRA Distributions Depend on Who You Are When it comes to distributions on inherited IRAs, your options depend on your relationship with the deceased. The rules for taking distributions are different for certain types of beneficiaries, and knowing how your relationship affects your choices is crucial in order to plan ahead. Spouse of the Original Owner If you are the spouse of the IRA’s original owner and you are the account’s sole beneficiary, you’ll have different options for distributions than other types of beneficiaries—like adult children or even charitable organizations. Designated Beneficiaries If you are not the spouse of the deceased individual, you are likely considered a “designated beneficiary.” This status includes adult children, unrelated individuals, and charitable organizations. Eligible Designated Beneficiaries Federal law allows certain exceptions to inherited retirement account distribution rules for beneficiaries that fall into three categories: Chronically ill or disabled individuals Minor children of the original owner Individuals who are younger than the original owner by no more than 10 years Rule #2: You Have to Pay Taxes on Certain Types of IRA Accounts Beneficiaries of IRAs are responsible for any taxes that may be due on the account. It’s crucial to understand which types of IRA accounts require beneficiaries to pay taxes and which do not. This can help you get a better picture of what your financial plan should be for the IRA funds. Traditional IRAs and Simple IRAs Both traditional IRAs and simple IRAs are subject to taxes when the funds are withdrawn by the beneficiary because the assets in the retirement account were contributed pre-tax by the original owner of the account. The beneficiary may be required to pay income tax on the amount withdrawn, which is calculated based on the beneficiary’s individual tax bracket. Roth IRAs Inherited Roth IRAs are not subject to income tax when received by a beneficiary. This is because assets within the Roth IRA were contributed to the account post-tax by the original owner. Rule #3: The Age at Death of the Original Account Owner Matters The age of death of an IRA owner can have an important impact on how distributions are made to the beneficiary. Knowing this information can help beneficiaries understand their options for receiving IRA funds. What If the Spouse Dies Before RBD? The Required Beginning Date (RBD) of an IRA is the date at which the original owner of the account would have had to start taking the Required Minimum Distribution (RMD). This is often at 72 years of age. If the account holder dies before the RBD and their spouse is the IRA’s sole beneficiary, the spouse has a few distribution options: Take a large sum distribution Take a distribution for the entire balance of the IRA Take the RMD over their own life expectancy If the spouse of the deceased chooses the final option, they must take the RMD beginning the year after the account holder’s death or the year that the account holder would have turned 72, whichever is later. What If the Spouse Dies After RBD? Say the IRA account holder passes away after already beginning their required distributions, and the spouse is the sole beneficiary. The assets must then be distributed over either the life expectancy of the spouse or the life expectancy of the deceased, whichever is longer. If the spouse’s life expectancy is used, the calculation is updated annually. But if the deceased’s life expectancy is chosen, the number is fixed the year they died and then reduced by one in the following years. No matter which option is chosen, the spouse of the deceased is responsible for distributing the assets in the IRA account. This helps to ensure that the assets are properly taken care of and enjoyed for many years to come. Rule #4: The Secure Act’s 10-Year Rule Applies to Non-spouse Beneficiaries For non-spouse beneficiaries that do not qualify as “eligible designated beneficiaries,” the rules are a bit different than those sole beneficiaries that are the spouse of the original IRA account holder. When it comes to non-spouse beneficiaries, the Secure Act has changed how retirement accounts are distributed. All assets must now be disbursed within 10 years instead of the life expectancy of the oldest beneficiary. Spouses, those with disabilities, and minors are exempt from this 10-year rule. However, minors are subject to it once they reach majority age. For those who choose to designate a non-person—such as an estate or a charity—as their retirement account beneficiary, the full balance must be distributed by the end of the fifth year following the year of the participant’s death. Contact a Houston Estate Planning Attorney About Your Options for Inherited Retirement Accounts Gaining an inheritance is a good thing. You can carry on the legacy of your lost loved one while you secure the financial future of both yourself and your family. But the laws and regulations surrounding inherited retirement accounts can be overwhelming, and if there’s a mistake made, it could cost you a lot. Getting help from an estate planning lawyer is essential when dealing with inherited IRA account funds. An experienced lawyer can help you understand the options available and the best way to manage the funds. Your Legacy Legal Care™ will help ensure your family’s future is secure and your loved one’s wishes are honored. Contact us today to get started.

The Benefits of a Revocable Living Trust: A Comprehensive Guide Curious about how to protect your assets while still being able to manage them? Estate planning can be a complex process, but it is essential for ensuring that an individual’s assets are secure and distributed according to their wishes. A revocable living trust is a popular estate planning tool that offers several benefits over traditional wills. Learn more about the benefits of a revocable living trust, how it can help individuals plan their estate, and how a Houston trust lawyer can help. Benefits of a Revocable Living Trust A revocable trust can be a valuable tool for managing and distributing assets during and after your lifetime. Save Time and Money For Your Heirs One of the primary benefits of a revocable living trust is that it can help your loved ones avoid probate for your estate. Probate and the settlement process is complex and can be time-consuming and expensive to navigate. By transferring assets to a revocable living trust, you can avoid probate for the trust’s assets. Ensure Privacy for Your Heirs Probate proceedings, even when you have the help of an experienced probate lawyer, are a matter of public record. This means anyone can access information about your assets and how they are distributed. You can maintain privacy for yourself and your heirs and keep your financial affairs private by using a revocable living trust. Maintain Control of Assets As the trust’s grantor, you can name yourself the trustee and retain control over the trust’s assets. This allows you to maintain control of any assets placed in the trust. Flexibility The trust document can be amended or revoked anytime, allowing you to make changes as life’s circumstances change. For example, if you need to remove assets, add assets, or change beneficiaries on the trust, you can do so at any time. Incapacity Planning Becoming incapacitated is scary to think about, but a revocable living trust can put your mind at ease. If you become incapacitated and cannot manage your affairs, the named successor trustee can step in and manage the trust’s assets. This can help ensure your affairs are handled according to your wishes, even if you cannot manage them yourself. Revocable Living Trust Vs. a Will While a revocable living trust offers several benefits over a traditional will, it is important to understand the differences between the two estate planning tools. A will is a legal document outlining how your assets will be distributed after death. Even if you have a valid will, your estate may still have to go through probate. Creating a Revocable Living Trust Creating a revocable living trust typically involves working with an estate planning attorney. An attorney can help you draft the trust document and ensure it complies with state laws. As the grantor, you must name a trustee and beneficiaries and outline how the trust’s assets will be managed and distributed. Funding and Maintaining a Revocable Living Trust Funding a revocable living trust involves transferring assets to the trust. This can include bank accounts, real estate, investments, and other assets. It is important to ensure that all assets are properly titled in the name of the trust to ensure that they are protected and avoid probate. When to Update a Revocable Living Trust It is important to periodically review and update a revocable living trust to ensure that it still reflects your wishes. Significant life changes, such as the birth of a child, marriage, divorce, or changes in state or tax laws, may require updates to the trust document. Enlist the Help of an Experienced Houston Trusts Attorney While a revocable trust may not be the best option for everyone, it can be a powerful tool. Working with an experienced estate planning attorney can help you ensure that your trust is drafted properly and legally. Contact us today at Your Legacy Legal Care, and we’ll review your situation to determine if a revocable living trust is your best estate planning document.

Losing someone you love is hard enough without money concerns weighing you down. But after their passing, your grief now comes with Texas-sized probate costs. Between attorney’s fees, appraisal costs, creditors, court charges, and more, probate expenses can quickly snowball.  You want to honor your loved one’s wishes, but are probate fees draining their estate? Navigating probate while grieving is overwhelming without understanding the real costs. Get the information you need to preserve assets and gain closure. In this post, we break down the average probate fees in Texas so you know what to expect. Learn the costs involved, what influences the price, and how our probate lawyers can help you along the way. What is Probate? Probate is the court-supervised process for administering a deceased person’s estate. It involves validating the will , inventorying assets, paying any outstanding debts, and finally distributing the remaining property to the rightful heirs. The probate process takes place in a specialized probate court, with a judge overseeing the proceedings. Depending on the situation, probate can take anywhere from six months to two years to fully complete. Texas Probate Fees There are several main categories of fees and costs associated with probate in Texas: Court Costs Probate fees can vary significantly by county in Texas. The probate court charges filing and publication costs over the proceedings, but totals are set at the local level. For example, in Chambers County , the probate filing fee is $411, while in Liberty County , it’s $420. Some other common probate costs include: Inventory filing fee (if filed 90+ days after appointment) Claims against the estate filing fee Letters of testamentary issuance fee Executor Fees The executor or personal representative of the estate is entitled to compensation for their administration duties. Texas law states that an executor can be paid up to 5% commission as standard compensation for what comes into the estate and what goes out of the estate (10% total).  This does not include the sale of real property when a realtor is involved or the decedent’s current bank accounts.  This commission is based on funds that are received and paid out in the course of administration of the estate. They may also be entitled to alternative compensation under special circumstances, such as when the commission is unreasonably little, or they had to go above and beyond in managing a business of the estate. Appraisal Costs If the estate includes real property, business interests, jewelry, art, or other uncommon assets, professional appraisals may be needed to determine fair market value. Appraisal fees vary depending on the asset type and appraiser.  Attorney Fees Probate attorneys typically charge based on an hourly rate, and the total fees can be influenced by the complexity of the case, the attorney’s experience, and the location. If you own property in another state as well, attorneys may charge a percentage of the estate’s value instead of an hourly rate. This percentage can range from 1% to 5% or more. Estimating Your Probate Costs — An Example Probating a will in Texas involves various court costs, executor fees, appraisal charges, and attorney bills. Expenses can add up quickly, so understanding common probate fees in Texas can help you budget appropriately. Let’s look at a hypothetical scenario to illustrate potential costs for a $500,000 estate going through probate in Chambers County: Court Costs Initial probate filing fee Inventory filing fee Letters of testamentary issuance fee Other minor court costs Executor Fees: Up to $25,000 10% of $500,000 estate value if no real estate nor decedant’s bank accounts Appraisal Costs: Around $5,000 Professional appraisals are needed for real estate, jewelry, art, etc. Attorney Fees Fees are based on reasonable hourly rate and time spent on the case Total Probate Costs =  $60,000++ So, in this hypothetical case, the total fees could amount to around 9-11% of the overall estate value. Costs vary case by case, but this illustrates the major expenses involved. Understanding the potential costs allows proper planning and budgeting. What Impacts Probate Costs in Texas? Because each situation is unique, it’s impossible to know the exact cost at the outset. But several factors influence the total cost of probate in Texas, including: Size of the Estate — Larger estates have disproportionately higher probate costs. For a $100,000 estate, total fees might be $14,000. But for a $1 million estate, fees could reach $100,000 or more. Complexity — The more complicated the estate, the higher the legal bill will likely be. Contested wills, family disputes over inheritance, separate business valuations, out-of-state property, and estate litigation can all drive up costs quickly. Working with an experienced probate attorney is essential in these cases. Location of Assets — If some estate assets are located in another state, ancillary probate proceedings will be required in that state. This adds separate court and attorney fees for those assets. Type of Assets — Difficult or unconventional assets like ownership shares in small businesses, intellectual property, digital assets, and cryptocurrency often necessitate specialized legal and tax expertise.  Juggling these different factors can be a lot to handle, adding emotional and financial stress to an already difficult situation. A knowledgeable probate lawyer can handle all court filings and give you an estimate of what to expect. This lifts a huge burden on family members already grieving their loss. The attorney also ensures full compliance with each step of the complex probate process, avoiding costly mistakes or omissions. If disputes arise, your attorney can mediate and negotiate on your behalf. For large or contentious estates especially, legal expertise is invaluable. How to Avoid Probate in Texas For those wishing to avoid the costs and delays of probate, there are several options: Living trusts transfer property outside of probate but require planning and legal fees upfront. Joint tenancy with the right of survivorship automatically passes property to the surviving owner. Transfer-on-death accounts and payable-on-death assets name beneficiaries who can take ownership directly and pass outside of probate. Gifting assets while living also removes them from the future probate estate but could cause tax implications and prevent eligibility for long-term care benefits. An estate planning attorney can advise whether these probate avoidance strategies make sense for your specific situation. Take Control Over Your Legacy Losing someone you love is painful enough without the added stress and cost of probate. The experienced estate planning attorneys at Your Legacy Legal Care are here to guide you through this challenging process. Having helped hundreds of families through probate in Harris, Galveston, Brazoria, Chambers, and Liberty Counties in Texas, we bring compassion along with solid legal knowledge. Our goal is to help you honor your loved one’s wishes while minimizing costs and complications for you and your family. We know this is an emotional time. Let us handle the legal complexities so you can focus on healing.  Contact us today for an initial consultation to discuss your probate situation in complete confidence. The sooner we can get involved, the more we can do to streamline the process for you.

Safeguarding assets and ensuring a legacy for your loved ones are aspirations many share. At the heart of this goal in Texas lies the family trust—a potent instrument in the estate planning toolkit. With the guidance of Your Legacy Legal Care, let’s unravel the intricacies of these trust and learn the steps to set one up effectively. What Exactly is a Family Trust Fund? A family trust is not just about legal paperwork. It is your way of keeping your assets safe and making sure they are handed down as you wish. With it, you can have a strong say over your assets and ensure your family benefits in the way you have planned, all while following Texas laws. Types of Family Trust in Texas Diverse needs call for diverse trust types, there are a few different types of trusts that families should be aware of in Texas: 1. Revocable Living Trust An adaptable and popular option, the revocable trust offers the flexibility of a living trust with the ability to manage and access your assets during your lifetime. Additionally, it ensures a smooth transition of these assets to your beneficiaries after your passing, effectively avoiding the lengthy probate process if it is properly funded. 2. Irrevocable Trust Once established, this trust becomes a steadfast shield, making alterations challenging, but not impossible. It provides unparalleled protection against potential legal disputes and creditors, simultaneously serving as an avenue for astute tax planning. 3. Testamentary Trust Embedded within your will, this trust springs into action after your demise. Crafted as a protective vessel, it ensures assets are safely relayed to beneficiaries, such as young children or others who might need additional oversight. It requires probate first in order to establish the testamentary trust. While the diverse trust options available in Texas empower individuals with choices tailored to their unique needs, navigating the intricacies of each can be daunting. Partnering with an experienced trusts lawyer can streamline the process, ensuring that you harness the full potential of these tools for the lasting benefit of your loved ones. The Process for Setting up a Family Trust in Texas Setting up a trust is a thoughtful act of preserving and directing your family’s financial future. 1. Confirming Your Eligibility Your first step in this journey is straightforward. To initiate a trust in Texas, you need to be at least 18 years of age and of sound mental judgment. However, this is just the starting point. 2. Designating the Right Trustee This decision is often underestimated in its importance. Your chosen trustee, whether an individual or an institution, shoulders the responsibility of making your trust come alive in the way you envisioned upon your death. They manage assets, make distributions, and ensure the trust’s terms are honored. The right trustee brings your intentions to fruition; the wrong one can derail them. 3. Crafting a Comprehensive Trust Document This is not just a piece of paper—it’s the blueprint of your financial wishes. While tempted by the DIY approach, the nuances and intricacies of Texas trust laws can trip up even the most astute. Working with an estate planning attorney is not just beneficial here; it’s essential. They ensure your trust document is clear, compliant, and aligned with your intentions. 4. Seamless Asset Transfer Injecting life into your trust requires the transfer of assets. This step, though seemingly transactional, is a cornerstone. It’s not just about changing titles; it’s about ensuring that the trust’s assets align with your goals and will be managed in the way you have outlined. At each stage, the guidance of an experienced estate planning attorney becomes invaluable. They navigate the legalities, provide insights into decisions, and ultimately, ensure that your trust is more than just a document—it’s a legacy. Trusts are intricate, and Your Legacy Legal Care is dedicated to ensuring yours stands as a testament to your vision. The Power and Promise of Family Trusts Trusts can help provide versatile solutions for modern challenges. Here are some of the key benefits: Streamlined Inheritance: Trusts simplify the often complicated probate process, allowing heirs to receive their inheritance more easily and without unnecessary delays. Privacy Protection: Trusts operate privately, ensuring the confidentiality of your financial decisions, unlike wills, which can be made public. Asset Shielding: Advanced options like irrevocable trusts offer robust protection for your assets against unforeseen challenges and claims. Creating a Financial Legacy: Trusts allow you more than just transferring wealth; they enable you to shape your legacy, giving you control over how your assets impact the future, whether through education, philanthropy, or family support. Tapping into the full potential of trusts will be the key to leaving a lasting legacy for your family. Treading Carefully: Trust Challenges While trusts are invaluable tools in estate planning, they can sometimes face challenges. Occasionally, disagreements arise when family members or beneficiaries feel uncertain about the trust’s provisions or the actions of the trustee. Such disputes can strain family dynamics and even escalate into legal battles. It’s essential, then, to ensure your trust document is clear, precise, and in line with Texas regulations. By proactively addressing potential points of contention and seeking the expertise of an estate planning attorney, you can create a trust that stands firm against challenges. Forge a Legacy with a Family Trust Family trust stands as more than mere legal tools; they symbolize our dedication to preserving a legacy for future generations. As we navigate the intricate web of Texas regulations and personal aspirations, the significance of having a clear, guided approach becomes evident. With Your Legacy Legal Care by your side, the journey is about crafting a lasting vision. We are here to shed light on the nuances of the estate planning process, ensuring every step taken resonates with your vision and commitment to those you hold dear. Let us be your guide. Contact us today to bring your legacy visions to life.

How to Create a Living Trust in 5 Simple Steps Estate planning conversations often circle back to that mysterious legal entity – the living trust. If you’re a Texas resident considering estate planning, you may have heard about these tools and wondered if one is right for you. A living trust can be a powerful legal tool with many benefits, allowing you to avoid probate , spare your family headaches, and even minimize taxes under the right circumstances. While living trusts have some complex legal aspects, most people really just want the basics – what are these documents in reality, and how do I create one? Lucky for you, creating a living trust distills down to 5 essential steps when structurally sound guidance lights the way. In this blog, we unlock the secrets to forming this powerful part of your legacy plans through simplified actions bringing legal terminology down to earth. What is a Living Trust, and How Does It Work? A living trust is a legal estate planning document created during your lifetime “inter vivos” rather than at your death like a will. It allows you to place assets like your home, investments, or personal property “into trust” (a separate entity) to be managed by a trustee for the benefit of trust beneficiaries. Unlike a will , which only goes into effect at your death, you can use a properly executed and funded Texas living trust to manage your assets while you’re still alive. This feature can be helpful, especially if you become incapacitated due to an illness or injury. Parties In a Trust Arrangement There are three main parties in a basic living trust arrangement: Grantor – This is you, the person creating the trust. You determine the terms and conditions, name a trustee, and designate beneficiaries. You can name yourself as the trustee if desired. Trustee – The trustee manages the assets placed inside the trust according to the trust agreement. Successor trustees take over if the first trustee dies or can no longer serve. Beneficiaries – The people or organizations who receive assets from the trust. You designate primary and contingent beneficiaries. Once you draft, execute, and fund assets into the trust, you officially give up individual ownership and control over the property. Under Texas law, the trustee has a fiduciary duty to manage and distribute trust assets in your best interests and only as legally allowed. This separation of asset ownership and control makes trusts powerful estate planning vehicles. Benefits of Setting up a Living Trust in Texas Living trusts offer several advantages that make them a popular choice for estate planning in Texas, including: Avoiding Probate The primary benefit is avoiding probate for property transferred into your living trust, simplifying estate matters after your passing. The court-supervised probate process can be quite lengthy and costly in Texas. It also makes all your assets public record, exposing sensitive financial information. Property left in your will must go through probate before beneficiaries can access it. A living trust lets you ensure that the property it holds can circumvent this process entirely after your death. A probate lawyer will guide you through the probate process in Texas. Privacy In most situations, living trusts are much more private than probated wills since they allow you to avoid court involvement after death. Only the trustee and beneficiaries know your trust’s details and contents. Possible Tax Savings Certain types of trusts , like irrevocable income or property trusts, can minimize estate taxes when properly structured. Our trust lawyers can advise if any tax planning trusts may benefit your specific situation. While Texas does not have a state estate or inheritance tax, you could still face federal estate taxes without proper planning. Even revocable living trusts may allow for some tax savings at the margins. Managing Your Affairs If Incapacitated Unfortunately, many of us may become incapacitated by illness or injury before we pass away. Your living trust includes contingency provisions so someone you choose can step in to manage the trust assets when you become impaired. Many Texans find this an invaluable benefit, sparing relatives from court-supervised guardianship of a minor child. While a will does nothing to help while you are alive, your living trust plan keeps working even if you become incapacitated. Step-By-Step Guide to Creating a Living Trust in an Estate Plan If you want greater certainty over what will happen to your assets when you pass away or become incapacitated, read on for step-by-step instructions on making your living trust in the Lone Star State. Step 1. Choose a Trustee Start by deciding on an initial trustee to manage trust assets and administer distributions to beneficiaries per the trust agreement. Many Texas grantors name themselves trustees to simplify control and reduce costs during life. Just be sure to name a successor trustee who can take over handling trust administration if you die or otherwise cannot continue serving – with clear guidance around the trustee succession order spelled out in the agreement. You also have the option to appoint a corporate trustee, like a trust company or bank, instead of naming friends or family members. This feature costs more but provides neutral, professional asset administration. Step 2. Designate Beneficiaries Next, name primary and contingent trust beneficiaries – those who will receive distributions of income, principal, or assets at certain events (like your death) as defined in the trust agreement. Spouses with joint property often name each other as primary beneficiaries. Children are common choices, too. You can split percentages between multiple beneficiaries. When naming minors, consider if custodial trusts may be appropriate to provide some oversight of assets until beneficiaries reach an age you deem sufficiently mature. Step 3. Draft and Execute the Trust Agreement Now, work with a skilled Texas estate planning attorney with whom you establish a fiduciary relationship to draw up tailored trust documents reflecting your goals. Documents should cover issues like: Exact trust property descriptions. Beneficiary rights to income and principal. Trustee powers and limitations. Trust rules around asset management. Trustee succession order. Contingency plans if beneficiaries die before you. Instructions for final asset distribution. Relying on pre-made, “one-size-fits-all” internet trust forms is extremely risky and not advised. After you execute all necessary documents, your attorney can assist in recording deeds or property titles and storing original documents securely if needed later. Step 4. Fund the Trust This vital step involves retitling assets from your name over to the trust ownership. Work methodically through the accounts and property you want to be held in trust, filing the correct paperwork that transfers legal and beneficial ownership. Remember that any assets not properly transferred into your trust by your death may need to go through probate. Also, fund your trust right away after execution for optimal results. Your attorney can guide you on meeting funding requirements. Common assets placed into Texas living trusts: House and other real estate. Financial and retirement accounts (stocks, bonds. etc). Artwork, jewelry, collectibles. Life insurance if avoiding estate tax is desired. Business shares or ownership stakes. How Funding a Living Trust Works A living trust has no real effect until it is “funded” by retitling assets from your personal ownership to ownership by the trust. Typical steps are: Open a new bank or brokerage account in the name of the trust. Execute new deed paperwork to transfer real estate into the trust. File change of ownership and beneficiary paperwork on financial accounts. Retitle vehicles and boats by changing registration. Update property and casualty insurance policies. Texas law does not require special transfer taxes or filings when you transfer property into or out of a living trust, which keeps costs down. You must adequately fund your living trust for it to work as intended. Our estate planning attorneys can assist you in doing everything correctly. Now that you understand the basics of a living trust and its functions, let’s examine why creating one can benefit Texas residents. Contact us for more information about this critical process. Step 5. Maintaining and Modifying a Texas Living Trust Simply signing your living trust documents alone doesn’t finish the process. Proper ongoing funding, management, updates when life changes happen, and responses to notices are critical over the years ahead. The Trustee’s Key Role Your hand-picked trustee plays one of the most vital parts in keeping your Texas living trust running smoothly after creating it. The role of a trustee typically includes: Adding newly acquired property into the trust. Investing, protecting, and growing trust assets. Paying taxes and expenses. Making beneficiary distributions if you become incapacitated. Wrapping up trust affairs if you pass away. Signing on as trustee is a major commitment requiring time, diligence, and impartiality in carrying out fiduciary duties. Modifying Beneficiaries or Assets Need to change designated beneficiaries or trustee succession details as time goes on? Or do you want to update the property held in trust after creating it? If you structured your living trust as revocable, you retain total flexibility as a grantor to alter anything whenever you wish. You simply file trust amendments with a Texas estate planning attorney whenever life events impact your plan – marriages, births, relocations, deaths, etc. Transfer any after-acquired property into the trust to keep it aligned with your current reality. When The Trust Terminates Upon the grantor’s death, specific administrative steps must happen before a living trust can wind down and distribute assets, including: The trustee files final tax returns for trust activity. Assets appraised to value the estate. The trustee formally notifies all beneficiaries. Outstanding debts and expenses are paid. The remaining property gets distributed to beneficiaries per trust instructions. The trustee files a termination certificate, legally closing the trust. At this point, your living trust has protected and passed on your legacy. Is a Living Trust Right for You? As you can see, living trusts involve some upfront effort to set up a trust. Still, these trusts provide substantial long-term benefits including incapacity provisions, simplifying your estate. Avoiding probate and court involvement, shielding families from hassles, and even minimizing taxes make them handy estate planning tools for many Texans. We hope this guide gave you valuable insight into what’s entailed when creating a living trust in the Lone Star State. Your next step is to schedule a consultation with one of the estate planning lawyers at Your Legacy Legal Care to explore whether adding a customized living trust to your plan may be worthwhile. Trust us to guide you in making better legal decisions, benefitting you and your loved ones for generations to come. Contact us today to start a conversation. Our team looks forward to assisting with all your Texas estate planning and living trust needs.

This may sound crazy, but free things aren’t always good things. This goes for inherited assets, too. Your grandmother unloading her retirement assets on you could actually come back to bite you in the end. Some financial assets like the family business could work to earn you an income until your retirement (which has its drawbacks). On the other hand, other assets, like the prehistoric jalopy, are a total money pit (not everything is “vintage”; some things are just old). Depending on what you have been gifted, you may ask, “Can I give part of my inheritance?” If you don’t know whether giving away your inheritance in part or whole is for you, let’s discuss it! Your Financial Advisor May Recommend Keeping Your Assets Low Have you ever heard of an inheritance tax? Well, it is sometimes called a “death tax” and is imposed on any assets transferred to a beneficiary when the owner dies. Death taxes are 40% over the federal estate tax limit. To be fair, a tax professional will tell you that Texas is one of the 33 states that do not levy a state inheritance tax. However, suppose a loved one who resides in another state leaves you money. In that case, the laws of that state concerning inheritance tax may apply to you, so be careful to check. Financial advisors may inform you to only accept inheritance to avoid the burden of paying taxes. Additionally, your estate’s worth will rise due to an inheritance, which could result in your estate paying more in federal estate taxes. You are not required to accept inheritance just because someone wants to pass assets to you if you do not want to pay more in taxes. There is quite a bit to consider. Be sure to ask your asset protection attorney about capital gains tax and the gift tax as well. An Inheritance May Impact Your Government Assistance An inheritance sounds great until you have to plan for the very distant future, and realize the very real consequences that you may face by receiving the inheritance. Some people inherit money, possessions, or property from family members. This can become a problem when they want to qualify for Medicaid. As you may be aware, if your income exceeds a certain threshold, you will be disqualified from Medicaid benefits. As a result, these people who were getting Medicaid for nursing homes might lose their housing and health insurance. Discuss these concerns with a knowledgeable Texas asset protection and elder law attorney to learn more about your options to prevent this issue. Inheriting a loved one’s assets can also have consequences for those who are disabled and receiving SSI or other government benefits. After receiving an inheritance, these loved ones can also exceed income thresholds, becoming disqualified from receiving their benefits. Luckily, this situation can be prevented through the use of Special Needs Trusts, or Supplemental Needs Trusts, when putting your estate planning in place. Our special needs planning attorneys have protected loved ones with disabilities for many years and can help your loved one with disabilities keep their government benefits while receiving an inheritance. You Can Give Part Of Your Inheritance Away The good thing about no inheritance tax is that you can give part of your inheritance away after inheriting it. You don’t even have to wait to draft a will. Giving benefits your loved ones immediately. It also effectively reduces the size of your estate, which can be crucial if you’re getting close to a certain threshold for the above reasons. Just be sure to keep the annual gift tax exclusion rules in mind while gifting. Consult an experienced Texas estate planning attorney to be sure you’re keeping up with the regulations. Build A Strong Estate Plan With A Texas Estate Planning Attorney While reviewing your estate plan with an experienced estate planning attorney, some assets simply have no financial future. If this happens to you, it is perfectly fine. Early inheritance has saved you and your loved ones a lot of future headaches at the probate court. Your Legacy Legal Care™ is right there with you on this journey. Schedule a strategy session with us so that we can pursue a worthwhile course of action.

January can be a difficult month for seniors, especially when it comes to prescription costs. With the start of the new year, Medicare prescription deductibles reset, leaving many seniors with high bills for their necessary medications. This can be a significant financial burden, especially for those on a fixed income. Kim Hegwood’s mother, like many others, has been facing this issue for the past two years since she retired. Her January prescription bill has been over $500 or more, which is an excessive amount for her income. But this year, Kim’s sister, Terry, decided to try a different approach. Terry took her mom’s prescriptions and started calling all of the pharmacies in town to ask the price with Medicare, Single Care Rx Discount Card, and Good Rx. The savings she found were unbelievable. By shopping around, she was able to save hundreds of dollars per month on their mother’s prescriptions. It was a time-consuming process, but it was absolutely worth it. Some of her prescriptions will be moving to a different pharmacy, and while she may have prescriptions in more than one pharmacy, the savings alone will make it worth it. If you are facing high prescription costs, Kim Hegwood encourages you to do the same. You can go to Singlecare.com and Goodrx.com to look up prescription pricing. These websites make it easy to compare prices and find the best deals on your prescriptions. Recently, Congress has allowed Medicare to negotiate drug prices. This is a big step in the right direction, and Kim hopes that they can beat the prices found on Single Care Rx and Good Rx. If they can, it will make a significant impact on the financial burden of seniors when it comes to prescription costs. In conclusion, January can be a difficult month for seniors when it comes to prescription costs, as attorney Kim Hegwood has experienced with her retired mother. But by taking the time to shop around and compare prices, significant savings can be found. Additionally, with the recent change in legislation allowing Medicare to negotiate drug prices, there is hope that even more savings will become available in the future. So, do not hesitate to look into these options and potentially save money on your prescription costs.

Our founder, Kimberly Hegwood, witnessed her grandparents struggle with the ins and outs of Social Security, estate planning, asset protection, elder law, and other obstacles correlated with aging. After experiencing her loved ones’ challenges first-hand, she founded Hegwood Law Group to assist other individuals and families who are facing similar difficulties. For over 25 years, our firm has helped families plan for the future, protect their loved ones, and have guided them through the unexpected. Hegwood Law Group has focused exclusively on elder law, asset protection, estate planning, long-term care planning, probate, guardianship, and special needs planning. As we have encountered the aging population’s growing need for more tailored services than a traditional law firm can provide, we are transitioning to fulfill those missing pieces and offer our clients more options to help them with the aging process. To accommodate our expanding services, we are excited to announce that we are changing our name from Hegwood Law Group to Your Legacy Legal Care™. By changing our name, we hope to better reflect our continuing devotion, compassion, and loyalty to our current and future clients, from the beginning of our journey together to the end. We will remain composed of the same great and growing team, along with providing the same excellent services to you and your loved ones, only with added services to fill in the gaps that we have seen so many families require. Our firm will now be a Dementia-Focused firm, allowing our team to understand what our clients are faced with to be better committed to assisting seniors, families, and individuals in planning for their future and coping during times of crisis. Our transition to Your Legacy Legal Care™ will allow for a more accurate reflection of who we are, the services we are passionate about, and the clients we serve. We chose “Your Legacy Legal Care™” because we are here for YOU. We know the importance of establishing a lasting legacy for you and your loved ones, but we also know our journey together should often not stop there. Our services will extend far past the establishment of your legal documents, as we will begin having a more direct role related to the long-term care of our clients. We hope you will join us in the transition to our new name and our Dementia-Focused firm. We look forward to unveiling our new services to you as we remain dedicated to providing education to help you make informed decisions, connecting you with essential resources, and serving as an advocate for those in need.

An estate plan often focuses on tangible property such as jewelry, artwork, money, and vehicles. However, in this age of technology, it is important to remember to include your digital assets. Digital assets consist of everything we own online. Because we spend more time on computers and smartphones than we ever did before, you may not realize how much digital stuff you own, from photos and videos to online accounts, cryptocurrency, and nonfungible tokens (NFTs). Why Is it Important to Plan for Digital Assets? Planning for digital assets is important for several reasons. First, without a plan, digital assets may get lost in the Internet ether and not pass to your loved ones after your death due to the simple fact that their existence is unknown. Second, planning now means your family will not have to worry about hunting for these items upon your death while also grieving a beloved family member. Third, like most adults (roughly 70 percent of them), you want certain aspects of your digital life to remain private. If you do not create a plan, your loved ones may learn things that you wish to keep secret. Finally, planning now can minimize the risk of identity theft, which happens to 2.4 million deceased Americans each year. Keep reading to learn more about why it is important to include digital assets in your estate plan and how to account for them. Digital Assets: What Are They? Instead of existing in photo albums and on videotapes and DVDs, most of our family photos and videos are now digital. Even if they lack commercial value, they certainly have sentimental value that you want to preserve for your family and friends. Social media accounts containing your photos and videos can also have value to your loved ones when you are gone. For example, a Facebook account can serve as a memorial after you pass away. When you consider all of the other accounts that you log into (more than 130 on average), the list becomes quite lengthy. Digital assets that you may own include the following: Social media accounts (e.g., Facebook, Twitter, LinkedIn) Financial accounts at brick-and-mortar and online institutions Business documents and other files stored in the cloud Cryptocurrency NFTs Databases Device backups Internet domain names and URLs Streaming service accounts (e.g., Netflix, HBO, Hulu) Merchant accounts (e.g., Amazon, Etsy, eBay) Gaming tokens Virtual avatars Points-based loyalty programs (e.g., for groceries, gas stations, airlines, and hotels) Rights to intellectual property, artwork, and literature Online betting accounts Monetized video content Including Digital Assets in Your Estate Plan Taking inventory of your digital assets may take some time, but it is worthwhile. If something were to happen to you, your estate planning attorney or another trusted person should have complete access to your online footprint. This includes usernames and passwords for all accounts. Tools such as Dashlane or the password manager integrated in your browser can be used to simplify the storage of usernames and passwords. In addition, you should continuously back up all digital assets, including photos and important documents, to the cloud, and ensure that your attorney and trusted person can easily access them when the time comes. Because they are not controlled by governments or banks, cybercurrency and NFTs must be handled carefully. You do not have the option of calling customer service to reset your password if you forget or lose it. NFT and cryptocurrency passwords should be stored online in a “hot wallet,” or in an offline device known as a “cold wallet.” Either way, someone needs to know how to access your passwords when you cannot. Other estate planning considerations for digital assets include the following: Your estate plan can provide that your digital possessions be handled by one or more cyber successors who can distribute your digital assets like tangible property. One cyber successor can control your Instagram account, for example, while another can take possession of your Bitcoin. Keep in mind that passwords should not be memorialized in your will, especially regarding cryptocurrency, as they could be made public if the will is submitted to probate court. Consider how technologically savvy a person is before appointing that person as your cyber successor. Next Steps for Your Digital Assets Talk to your estate planning attorney about your digital assets and cyber successors. Have a conversation with potential cyber successors about how they would handle your assets, and make sure that they would carry out your wishes before appointing them. Digital assets can be placed into a trust or distributed through your will, or you could grant access to them through a power of attorney. With the help of an experienced estate planning attorney, you can feel relieved that your digital assets will be easily located, managed, and passed to your loved ones. To take the next step and speak with an experienced estate planning attorney at Your Legacy Legal Care, call our office at (281) 218-0880 or contact us here.