Estate Planning

What is Estate Planning?

Estate planning is the preparation of tasks that serve to manage an individual's asset base in the event of their incapacitation or death. The planning includes the bequest of assets to heirs and the settlement of estate taxes. Most estate plans are set up with the help of an attorney experienced in estate law.

Common Types of Estate Planning:

  Will-Based Estate Planning
  Trust-Based Estate Planning
  Last Will and Testament With a Pour-Over Will
  Revocable Living Trust
  Advance Medical Directive
  Living Will
  Powers of Attorney

Why Is This Important?

Estate planning is one of the most important decisions a person can take in their lifetime that will impact not only their future, but their loved ones as well. 

The key here is control. If you plan ahead, well, you will be prepared for whatever life has in place as it relates to your assets, the disposition of those assets, medical and financial decisions when dealing with incapacity, and even guardianship designations for your minor children. 

Planning ahead can have a great impact for your loved ones and it generally does. It doesn't matter if you have a large estate or if you don't have a lot of assets. The important thing is that you leave a roadmap for you and your family on how certain decisions will be made and a clear guide on how your assets will be distributed. 

Estate Planning will also dictate what type of probate proceeding will take place when that time comes. The probate court generally deals with testacy and intestacy.

What does that mean? 

In simple terms, testate means when you leave a last will and testament. Intestate means that that individual did not leave a will behind and that the Texas intestacy default rules will apply. 

The intestacy default rules relate to the disposition of your assets based on the characterization of your property. In Texas, property can be characterized as community property or separate property. 

Community property is all property acquired during the marriage that is not separate property. Since Texas is a community property state, this means that all the property you acquire during the marriage regardless of the title of such property will be characterized as community property. 

Separate property is all property that was acquired before the marriage, through gift or inheritance. This means that even if you are married and you acquire property via gift, that property will still be described as your separate property.  Now, the intent of the property being received or labeled as a gift must be proven. That means that donor must have intended for you to received the property as a gift. 

Lets just say you are married and you receive an inheritance, well, pursuant to Texas law, that property will be described as your separate property preventing that property from becoming part of your marital estate.