When someone dies without having at least a basic Last Will and Testament in place the individual is said to have died “intestate.” An intestate estate is probated using the Texas intestate succession laws, meaning the State of Texas decides what happens to your estate assets. As a general rule, only very close family members (spouse, children, parent) will inherit from your estate if you die intestate.
Probate is the legal process that is typically required following the death of an individual. Probate serves many purposes, starting with providing a structure for identifying, locating, and securing the decedent’s assets. Probate is also used as a mechanism by which creditors of the estate may file claims against the estate as well as way to ensure that estate taxes are paid to both the state and federal government. You need to understand the probate process because you may find yourself directly involved in the probate of someone’s estate one day as well as because a basic knowledge of probate helps you create your own estate plan.
Like most people, you likely think of a Will as a way to distribute your property after your death – and nothing more. Your Will, however, can do more than just create a road map for the distribution of your estate assets after your death. One of the most important considerations when creating a Will, in fact, is who to appoint as the Executor of your estate. In addition, there are factors that should go into creating your Will that you may not have thought of, but you should. Find out more about planning a will.
In the age of electronics, it is very tempting to turn to the internet for everything – even your estate planning documents. After all, it is easy enough to find a “fill-in-the blank” Last Will and Testament form on the internet; however, the risk you take of ending up with a Will riddled with errors and omissions is great. Moreover, those errors and omissions could cost your loved ones a considerable amount of time and money after you are gone. Read more about why you should not use a DIY Will.
Your Last Will and Testament will likely form the foundation of your estate plan; however, your Will should not be your entire estate plan. To ensure that all of your estate planning needs and goals are met you will likely need to include additional estate planning tools and documents. Although once used almost exclusively by wealthy families to guard the family fortune, living trusts are now commonly found in the average person’s estate plan.
All estates are potentially subject to federal gift and estate taxation following the death of the taxpayer. This tax is levied on the combined value of all qualifying gifts made during your lifetime and the value of all estate assets owned by you at the time of your death. At a tax rate of 40 percent, the federal gift and estate tax can significantly diminish the value of the estate you leave behind for loved ones if you fail to plan ahead.
People frequently think of incapacity as something that only occurs after you reach retirement age. While age related dementia diseases can certainly be the cause of incapacity, they are hardly the only possible cause. The reality is that an illness or injury can cause your incapacity at any age and at any time. If incapacity does strike and leave you unable to make decisions or manage your assets, do you have a plan for that?
If you are relatively young yet and have never relied on Medicaid for your healthcare coverage you may wonder why you would need to include Medicaid planning in your estate plan. The answer can be found in the likelihood that you will one day need long-term care and the high cost of that care. Like over half of all seniors, you may find yourself turning to Medicaid for help with the costs of long-term care and, if you do, you need to be ready because qualifying for Medicaid without putting your hard-earned assets at risk can be tricky.