Estate Planning FAQ

No. A power of attorney dies with the power grantor. If you need to act on behalf of a deceased person, then you will need to do some sort of action in probate court. The type of probate court action depends on many factors.

The person who should make an application to probate a will is governed by Sec. 76 of the Texas Probate Code. If there is a will, then the executor or any person interested in the estate may make an application for probate.

In most cases, you are not responsible for the debts of a deceased person. The notable exception is a situation where you guaranteed or co-borrowed with the deceased. In other words, you agreed to be responsible for the debt of the deceased.

Yes, eventually. If the borrower dies before a bank has followed the rules for a non-judicial foreclosure, then the bank either has to notify the personal representative of the estate (if there is one), open a dependent administration (if there is no pending administration), or proceed against the heirs (depending on the type of loan.)

No. In Texas, an estate is not a legal entity. Therefore, it cannot sue or be sued. A court will need to appoint a personal representative of an estate, acting in his or her capacity.

No. A medical power of attorney is only used to make medical treatment decisions. To make decisions regarding discontinuation of life support, you would need to execute a living will.

Unfortunately, this is not uncommon. If you have possession of a deceased person’s will, you have a duty to either file the will for probate (assuming you have standing or capacity to do so) or you should deliver the will to the clerk of the court.

If the initial premium was paid out of community funds, the life insurance policy may be a community asset. This means that one-half of the policy “belongs” to the surviving spouse. If a third person is named beneficiary of a community-owned life insurance policy, and the surviving spouse did not sign a waiver, then the surviving spouse may challenge the beneficiary designation. If naming the other person is found to be a fraud on the surviving spouse, the spouse may be awarded a share of the death benefits and the named beneficiary will be entitled to receive the remainder. If you have an insurance issue that you would like to discuss, please contact us.

In Texas, a will may be revoked by overt act (such as tearing it up) or by the publication of a new will that expressly revokes the prior will. Contact Us if you would like to revoke a will, or draft a new estate plan.

There are several ways to dispose of a deceased person’s property in Texas. Assuming the person died intestate (without a will), the Texas laws of descent and distribution would control the disposition. The types of procedures necessary to document the transfer of assets would depend on the status of the estate.

If someone is appointed as an executor in a will, or someone applies to be an administrator of an estate, the person cannot be “disqualified” under Sec. 78 of the Texas Probate Code. This section specifically prohibits the following people from administering an estate:

(a) An incapacitated person;

(b) A convicted felon, under the laws either of the United States or of any state or territory of the United States, or of the District of Columbia, unless such person has been duly pardoned, or his civil rights restored, in accordance with law;

(c) A non-resident (natural person or corporation) of this State who has not appointed a resident agent to accept service of process in all actions or proceedings with respect to the estate, and caused such appointment to be filed with the court;

(d) A corporation not authorized to act as a fiduciary in this State;
or
(e) A person whom the court finds unsuitable.

Adult name changes are governed by the Texas Family Code Sec. 45.102. Per the code, an adult may petition the court for a change of his or her name. If the person wishing to change his or her name has a felony conviction, then the court may allow the person to change his name, if the court finds that it is in the best interest of the person and the public. The court will require that at least two years have lapsed since the completion of any applicable felony probation period or discharge.

Sec. 77 of the Texas Probate Code handles the order of persons who can administer an estate of a deceased person.

The code provides (in order):

(a) To the person named as executor in the will of the deceased (assuming the person is available and qualified to serve.)

(b) To the surviving spouse.

(c) To the principal beneficiary under the will, or the person who is to receive the majority of estate assets under the will.

(d) To any devisee or legatee of the testator.

(e) To the next of kin of the deceased, the nearest in order of descent first, and so on, and next of kin includes a person and his descendants who legally adopted the deceased or who have been legally adopted by the deceased.

(f) To a creditor of the deceased.

(g) To any person of good character residing in the county who applies therefor.

(h) To any other person not disqualified under the following Section.

If more than one person qualifies, the court has discretion in choosing an administrator.

Any person absenting himself for seven successive years shall be presumed dead unless it is proved that the person was alive within the seven-year period. Texas Civil Practice and Remedies Code Sec. 133.001.

Assuming the person who wrote the will is deceased, and the person who has possession of the original will is refusing to deliver it to the court You can file an action in probate court to “show cause” under Sec. 75 of the Texas Probate Code. Under this section, a person who has possession of a will has to appear in court and explain why the will has not been delivered to the court as of yet. If the person refuses, the court can hold the person in possession of the will in contempt of court.

Not necessarily. Property in Texas is described as either being community property or separate property. A married person dying intestate (i.e. without a will) would have the property divided as follows:

Community property:

The surviving spouse would get his/her 1/2 of the community estate. If the deceased spouse had children that were not also children of the surviving spouse, then the children of the deceased spouse would receive 1/2 of the community estate.

Separate property:

The surviving spouse would receive 1/3 of the non-real estate property, and the children would receive 2/3. Of the real estate, the surviving spouse would receive a 1/3 life estate in the property and the children would receive the 1/3 remainder interest (after the subsequent death of the surviving spouse) and a 2/3 outright interest in the real property.

Wills are always helpful, even if you have a modest estate.

There are a few reasons for this:

1. If you have children, you can appoint a guardian for them, should the need arise.
2. Even if your estate is small now, that doesn’t mean that it will be small at a later date.
3. If the death was related to the wrongful or negligent acts of another, then a will would dictate where your pre-death damages for a resulting lawsuit would go, and who would be responsible for prosecuting a civil lawsuit on your behalf.
4. Even if your plan is probate avoidance, there are likely assets that you may fail to place into a probate avoidance mechanism.
5. If you have a business, you can plan for a smooth transition to a friend or family member.

No. So long as you are competent, you can revoke a power of attorney, medical or otherwise. Also, the medical power of attorney is only in effect if you are unable to make your decisions known.

This is a bad idea. If you are in possession of an original will of a deceased person, you have a duty under Texas Probate Code Sec. 75 to deliver the original will to the county clerk’s office. A judge may issue a contempt order if you fail to comply.

If you are purposely hiding the will for a fraudulent purpose, then this may also constitute a felony (state jail) under Texas Penal Code Sec. 32.47 (d)(1)

If you are the executor named in the will or a beneficiary listed in the will, you can file the will for probate in an appropriate probate or county court. If you do not wish to file the will, you can turn it over to the county clerk’s office, pursuant to Section 75 of the Texas Probate Code.

Probate does not have to be expensive. Probate in Texas can be straightforward, efficient, and cost-effective if planned for properly. This means a valid will, prepared by someone who knows what they are doing. Probate problems arise when people attempt to use homemade wills, do-it-yourself kit wills, or try to make changes to wills without following the appropriate procedures. Also, poorly written wills may tend to be vague or ambiguous, requiring court supervision.

Probate is the process by which you prove that a person is deceased and who should be entitled to the deceased person’s property (including ownership of a lawsuit for injuries sustained prior to death.) The deceased is commonly referred to as the “Decedent” and the property of the Decedent is called the “Estate.” If the Decedent had a will, then the will need to be taken to probate court where a judge will rule on the will’s validity (called a “prove up”). During this process, the judge will appoint (typically per the terms of the will) a representative of the Decedent’s estate. This person is called an “executor” of the estate. Contact us for more information.

A power of attorney grantor can grant broad powers under the power of attorney document to a power holder. The power holder owes a fiduciary duty to the power grantor. This means that the power holder must put the interests of the power grantor above his or her own interests. If a power holder is acting beyond the scope of the powers granted by the document, or the power holder is abusing the power, then the power grantor (or the power grantor’s representative) can hold the power holder accountable. If you have an issue such as this that you would like to discuss, please contact us.

No. Texas Probate Code Section 78(b) specifically bars anyone with a felony conviction from serving as an executor of an estate.

Texas law allows adults to change their names, pursuant to a court order. The applicant must be an adult and not subject to registration requirements of the Texas Penal Code. If the person has a criminal record greater than a class C misdemeanor, then the change is up to the discretion of the court. The name change does not change any obligations of the person, and must not be made for the purpose of defrauding creditors. Our office has handled numerous name changes for adults.

In most cases, some proceedings will be necessary in order to probate a deceased person’s estate. Typically, there is some property that cannot be transferred absent some sort of probate action. Luckily, Texas probate can be a simple and straightforward process in many instances.

In Texas, a life insurance policy that is purchased after a person is married, and community funds were used to pay for it, then the surviving spouse may have an ownership interest in the policy. However, a spouse may waive rights to the policy by signing a waiver. If your spouse had designated another as the beneficiary of a life insurance policy without your consent, or if you have questions, please contact us.

Texas Probate Code Sec. 6 provides that you can probate a will in the following places:

(a) in the county where the deceased lived (provided the deceased lived in Texas)
(b) if the deceased didn’t live in Texas but died here, then in the county of death or the county where the deceased had most of his/her property
(c) if the deceased had no domicile in Texas and died outside of Texas, then where did the next of kin live
(d) if the deceased had no kin in the state, no domicile in the state, and died outside the state, then where the deceased owned property
(e) Wherever an applicant resides, if the sole purpose is for receipt of government benefits due to a deceased person, pursuant to specific guidelines.

In order to determine the appropriate venue for probating a will in Texas, we need to look at Estates Code Section 33.001. The statute provides that if the deceased lived in Texas, then the will should be probated in the county in which the decedent lived.

If the decedent did not live in Texas but died in Texas, then probate would be proper in:

i) the county where the decedent owned property, or

ii) the county where the decedent died

If the decedent did not live in Texas and did not die in Texas, then probate would be proper in:

i) any county where the decedent's next of kin reside or

ii) if there is no next of kin, then the county where the decedent’s property is located.

Texas Probate Code Sec. 42(a) states that a child born to an unmarried woman may inherit from that woman if she does not have a will.

Although Texas Probate Code Sec. 42(b) allows a child of an unwed couple to also inherit from the father (assuming he does not have a will), the child must provide proof of paternity. The most common ways of proving paternity are via a court finding (such as a paternity suit), a child born within 300 days of the divorce (between the child’s mother and the deceased father), a court order (such as an adoption) or the father executes an acknowledgment of paternity. If the father is already deceased, the child must provide “clear and convincing” evidence of paternity (such as a DNA test.)

The child has four years from the date of death to establish paternity, per Tex. Civ. Prac & rem. Code Sec. 16.051

Not necessarily. Sec. 271 of the Texas Probate Code offers protection for the surviving spouse regarding the homestead (and other exempt property as set forth in the Texas Constitution.) This applies whether or not the homestead is separate or community property (Sec. 282 of the Texas Probate Code.)

Possibly. Texas law will assume that if an original will cannot be located, then the testator (the person who wrote the will) has destroyed or revoked it. However, a court may hear evidence that the will was destroyed or hidden by an heir. If the court finds that an heir destroyed the will, and you can prove what the original will contained, the court may (in its discretion) allow you to probate a copy of the will.

There are a few different types of powers of attorney. Here are the more common ones:

1. General power of attorney: This document allows the power holder to sign the power grantor’s name on legal documents. The powers are broad and sweeping. The power holder owes a fiduciary duty to the power grantor. The power continues until the power ends on its own terms, or is revoked, the grantor dies or becomes incompetent.

2. Durable power of attorney: A power of attorney typically ends with the death or incompetence of the grantor. If the power is made “durable” then the power does not cease on the incapacity of the grantor. The power will end with either the death of the grantor or the removal of the power held by a court.

3. Springing power of attorney: This power of attorney comes into effect upon a future condition. Typically, this is the incapacity of the grantor. The power remains in effect until either the death of the grantor, removal by a court, or capacity being restored to the power grantor.

4. Limited power of attorney: This power of attorney is limited to a specific transaction. Typically, this arises in a real estate context, where someone gives permission to sign closing documents on behalf of another.

5. Medical power of attorney: This is an entirely different type of document which allows a person to make medical decisions on behalf of another. These decisions cannot override the power grantor’s expressed wishes. The power only comes into effect if the power grantor is unable to make his wishes known. This document also does not allow one to make end-of-life decisions. If you have this document, you should discuss it with your primary care physicians ahead of any important procedure.

6. Guardianship declaration: This is a document that appoints someone to care for your person if you are unable to care for yourself, or after a finding of incompetency.

7. Living will, physician’s directive, DNR: This is a companion document to the medical power of attorney. This document tells a health care provider whether or not you want to be kept alive in either an irreversible unconscious mental state or use heroic measures to keep you alive if you are suffering from a terminal condition.

A deed of trust is an instrument usually used in real property financing. The document appoints a trustee, who has the power to foreclose and sell the property should certain conditions be met.

A durable power of attorney is a document that allows someone to act on behalf of you. The power can take place immediately and continue to work if you are later declared incompetent, or it can spring into action if you are later declared to be incompetent. The “durable” portion means that if you are ever declared incompetent (incapable of managing your own affairs) then the person may act on your behalf. The person to whom the power is granted owes a fiduciary duty to the power grantor. For more information about a power of attorney, please contact us.

A living will is a document that notifies your health care provider of your wishes regarding comfort care, and the provision of life support if you are ever in a persistent vegetative state. You can select whether to be kept alive or not, and whether or not to receive comfort care. This document is also called an Advanced Directive.

A Medicaid-compliant estate plan includes a will, power of attorney, and a HIPPA release. The plan would include a number of actions, including gifting, and asset planning such that the Medicaid rules are strictly complied with. Examples include shifting money from Medicaid countable assets to Medicaid compliant accounts, use of a Miller Trust, and Special Needs Trust.

A power of attorney is a document that allows a person to act on behalf of another person. This power can be limited, which means that the person only has permission to do specific tasks (such as sign a document) or general (giving broad powers). The person holding the power of attorney owes a fiduciary duty to the power grantor. There are many types of powers of attorney. A power of attorney will not survive the death of the power grantor. Contact us for more information about a power of attorney.

A remainderman, more commonly referred to as a remainder interest, is a person or entity that receives property after a certain condition has been met.

The most common remainder interest occurs when someone who has a life estate interest in a parcel of land dies. The property then becomes owned by the remainderman.

A revocable living trust is a mechanism in which a person can title assets to a trust, but can still terminate the trust and take back the assets during his or her lifetime. Most trusts provide that the trust will become irrevocable once the testator (the person who sets up the trust) becomes incapacitated or dies. These revocable living trusts are typically used in complex estates, older people, or unmarried couples. Contact us for more information about setting up a revocable living trust.

Also known as the “Money Follows the Person” rider. This section of law provides that if a person moves from nursing to community-based care facilities, the funding for such a person will have such funding follow him/her from the nursing facility to the community care service.

The nickname refers to the number 28 rider in Article II of the General Appropriations Act (78th Legislature, Regular Session, 2003) that stipulates that as clients relocate from nursing facilities to community care services, the nursing facility funds will be transferred to the community care budget to cover the cost of their services. See also: House Bill 1867, 79th Legislature, Regular Session, 2005.

An estate is simply the property that belongs to a person. In Texas, an estate is not a legal entity, so an estate cannot sue or be sued by someone.

Probate actions in Texas can only affect title to property within the Texas borders. In order to collect property outside Texas, an additional probate proceeding must be done in an appropriate court located in that state.

For example, let’s suppose that you have a person who died in Texas, but had property in Oklahoma. If you instituted a Texas probate action in Texas court, the Texas probate court would not have jurisdiction over the Oklahoma property. In order to access the Oklahoma property, you would need to file an action in probate court in Oklahoma. This secondary action is referred to as “ancillary probate”.

In some cases, a family business is the most important asset in a family’s financial well-being. Business succession planning is a type of estate plan for people with family-owned businesses. The specific planning includes who takes care of and runs the family business after the passing of the principal owner or operator. Business succession planning typically includes life insurance planning, estate planning, and contract law. The cost and complexity of a business succession plan vary with the type of business, and the objective of the plan. Contact Us for more information.

In the context of marital property, all property that is not specifically the separate property is community property. Texas Family Code Sec. 3.002. A presumption of community property exists under Sec. 3.003.

This question often arises when a person dies without a will (intestate) and a court order is needed to clear title to the property. In Texas, a small estate affidavit can accomplish this. To qualify, the intestate decedent must have less than $50,000 of assets (not including the homestead or exempt property), be solvent, and have no real property (aside from the homestead.) This is not available in all cases and is subject to the discretion of the court. If you have an estate matter that you would like to discuss with our office, please contact us.

Exempt personal property means that the property is (under most circumstances) unavailable for attachment by creditors.

Hospice care refers to a change in the style of treatment of a disease. Typically, hospice care refers to medical treatment or therapy in light of the impending death of a patient. The goal of hospice is to help terminally ill patients with “comfort care.”

MERP is the Medicaid Estate Recovery Program. This program seeks reimbursement from a deceased person who received specific Medicaid benefits during his or her lifetime.

Community property versus separate property deals with marriages. Texas Constitution Art. 16, Sec. 15 gives a lengthy explanation. The definitions are further spelled out in Texas Family Code Sec. 3.001.

All property, both real and personal, of a spouse owned or claimed before marriage is separate property. Further, property acquired afterward by gift, devise, or descent, shall be the separate property of that spouse. Additionally, damages for personal injuries are considered separate property (with the exception of the loss of earning capacity.)

Section 42.002 of the Texas Property Code has a list of exempt personal property. Please note that this list is subject to conditions. The property’s status as exempt does not preclude attachment if the property is secured by a lien. For example, a person purchasing a car on credit can still have the car repossessed by the credit grantor. Sec. 42.0021 also provides protections for individual retirement accounts (IRA) and certain savings accounts.

Texas Probate Code Sec. 77 governs the order in which people may serve as either executor or administrator of an estate. The order is as follows:

(a) To the person named as executor in the will of the deceased.
(b) To the surviving spouse.
(c) To the principal beneficiary of the testator.
(d) To any beneficiary of the testator.
(e) To the next of kin of the deceased, the nearest in order of descent first, and so on…
(f) To a creditor of the deceased.
(g) To any person of good character residing in the county who applies.
(h) To any other person not disqualified under the following Section.

When applicants are equally entitled, letters shall be granted to the applicant who, in the judgment of the court, is most likely to administer the estate advantageously, or they may be granted to any two or more of such applicants.

In Texas, probate can be a very simple and inexpensive process, if planned properly. As such, probate avoidance should not be the goal of an estate plan. A more appropriate goal should be tax avoidance or ease of estate administration. This allows an estate planner to use the full suite of estate planning vehicles in planning. In some instances, a person may be worried about their beneficiaries or heirs fighting over estate assets. In other cases, people just don’t trust the court system or are unfamiliar with the probate process.