Estate Planning During Divorce Proceedings
Divorce is a period of significant change and emotional upheaval, not to mention one of the busiest periods of your life. Amid all the other demands on your time, it’s easy to overlook the practical- yet vital- task of revisiting your estate plan. Despite how unimportant it may feel, if you are contemplating, initiating, or actively engaged in divorce may be critical to update your estate plan to reflect the dissolution of your marriage. The choices made, or more commonly, left unmade, can have a long-lasting and detrimental impact on you and your loved ones. Why Estate Planning During Divorce Matters When a marriage ends, the emotional turmoil often overshadows practical concerns. However, the law does not wait for your emotional process to catch up. Until a divorce decree is final, you and your spouse remain legally bound. This bond extends to your rights and responsibilities regarding property, inheritance, and decision-making authority. Unintended Inheritance: If you die before your divorce is finalized, your estranged spouse may be entitled to a substantial portion of your estate under state law—regardless of your intentions. Existing Estate Plans: Wills, trusts, powers of attorney, and beneficiary designations often name a spouse as primary beneficiary
Read More
Plan for Your Pets’ Future: Protect Them with a Will
August is National Make-A-Will Month, a time to reflect on how planning for the future can make a real difference for the people—and pets—you love. For pet owners, one of the most important yet overlooked aspects of estate planning is making sure your animals are cared for if something happens to you. Did you know that nearly 10% of animals in the U.S. are surrendered to shelters after their owners pass away without a will or care plan in place? Without clear instructions, your beloved pets could face uncertainty, and in some cases, homelessness. Attorney Amanda Pierson, a UT graduate and expert in Probate and Estate Planning, will be sharing her insights in a free webinar hosted by the Houston Humane Society on August 21st at noon. In this informative session, Amanda will discuss: Why including your pets in your will is essential for their security and well-being. How an estate plan can give you peace of mind knowing your pets will be safe, supported, and loved. Ways to make a lasting impact by including charitable gifts in your estate plans that benefit organizations like the Houston Humane Society. Amanda’s presentation will provide practical tips for creating a pet
Read More
Estate Planning Considerations with a Dementia Diagnosis
A dementia diagnosis can be devastating for a family. When dealing with uncertain and unpredictable diseases like Alzheimer’s Disease, estate planning can be both daunting and confusing. In cases where degenerative cognitive diseases are a factor, early estate planning, while you or your loved one still has cognitive ability, becomes essential to ensuring a secure future for your family. Estate plans consist of several documents, including Wills, Trusts, Powers of Attorney, and Advance Medical Directives. These documents propound in writing who your inheritors are, what they will receive, who has authority to make medical and financial decisions on your behalf, and what kind of medical care you wish to receive at the end of your life. Once faced with a dementia diagnosis, these documents become an essential link between your named decision makers and third party medical and financial institutions. Your estate planning documents ensure that your preferences will be upheld and your assets protected once you are no longer able to provide cognitive input. For instance, in your Medical Power of Attorney, you will name trusted individuals who will make medical decisions for you if you are unable to communicate. Additionally, an Advance Medical Directive can be used
Read More
Common Mistakes in Estate Planning and How to Avoid Them
Procrastination The most common mistake people make in estate planning? Not doing it! Many people view estate planning as overwhelming and easy to delay pending more pressing life events. Sometimes people are simply uncomfortable discussing estate planning, so they avoid it. Another common reason for delaying or avoiding estate planning is the mistaken belief that only rich people need estate plans. However, an estate plan is important for all people. Life is uncertain. Estate planning helps combat the uncertainties of life. Often people discover the importance of estate planning when there is an emergency and the lack of medical and financial powers of attorney make caring for and handling finances on behalf of a loved one impossible. It is important to have a plan in place that offers your loved ones direction if you are deceased, or unable to make decisions for yourself. No matter your age or stage in life, it is important to have at least a basic plan in place. DIY Estate Planning While there are online resources available to people plan their estates on their own, not all online estate planning forms and resources are accurate, reliable, or sufficient for a person’s needs. In using
Read More
The Importance of Proper Storage for Estate Planning Documents
When it comes to estate planning, having the right documents in place is only part of the equation. Equally important is ensuring that these documents are properly stored and easily accessible when needed. Estate planning documents, such as wills, trusts, powers of attorney, and healthcare directives, represent your final wishes and can provide significant peace of mind to both you and your loved ones. Without proper storage, these documents could be lost, damaged, or inaccessible when the time comes to use them. Why Proper Storage Matters Estate planning documents serve as legal instructions for the distribution of your assets, guardianship of minor children, and decisions regarding medical care should you be unable to make them yourself. If these documents are not stored securely, there’s a risk that they could be tampered with, misplaced, or inadvertently destroyed. In the event of an emergency, ensuring these documents are accessible to trusted individuals is vital. Types of Estate Planning Documents Common estate planning documents include: Will: A legal document outlining how your assets will be distributed after your death. Trusts: A legal structure that comes into effect during your life and holds and distributes your assets according to your wishes. Power of
Read More
What is a Small Estate Affidavit?
Dealing with the loss of a loved one can be overwhelming, especially when it comes to managing their estate. In Texas, a small estate affidavit offers a simplified way to transfer assets without going through a full probate process. This option is particularly useful for families handling smaller estates, helping to save both time and money. What Is a Small Estate Affidavit? A Small Estate Affidavit is a legal document that allows heirs to collect and distribute the assets of a deceased person without going to court. In Texas, this process is available only under specific circumstances and is governed by the Texas Estates Code. It’s an efficient alternative for estates that meet certain requirements, particularly when the value of the estate is modest. Requirements for Using a Small Estate Affidavit in Texas The Estate’s Value Must Be Small The total value of the estate, excluding the homestead and exempt property, must not exceed $75,000. This limit ensures that the affidavit is used only for smaller estates. No Will A Small Estate Affidavit can only be used if the deceased did not leave a valid will. Assets Qualify for Simplified Transfer The affidavit is primarily used to transfer assets
Read More
Do I Have to Pay Estate Taxes When I Die?
Estate taxes can be a significant concern when planning for the future, and many individuals want to know whether their estate will be subject to taxes when they pass away. For residents of Texas, the good news is that the state itself does not impose an estate tax. However, federal estate tax laws may still apply depending on the size of the estate. Texas and Estate Taxes In Texas, there is no state estate tax, sometimes referred to as a “death tax.” This means that if you are a Texas resident, your estate will not owe any taxes to the state upon your death. This is advantageous for Texans, as some states impose their own estate or inheritance taxes, which can reduce the amount of assets passed on to heirs. The absence of a state-level estate tax simplifies the estate planning process and often allows for more flexibility in passing on wealth to future generations. Federal Estate Taxes While Texas does not have its own estate tax, estates may still be subject to federal estate taxes. The federal estate tax exemption for 2024 is $13.61 million per individual. This means that if the total value of your estate is
Read More
IRS Announces 2024 Tax Adjustments: What You Need to Know for Your Estate Planning
On November 9, 2023, the Internal Revenue Service (IRS) took a crucial step in keeping pace with the relentless march of inflation by issuing Revenue Procedure 2023-34. This directive provides the annual inflation adjustments for various tax provisions, offering valuable insights for individual taxpayers planning their financial strategies for the upcoming tax year. In this article we discuss the key highlights of these adjustments and their implications for estate planning in 2024. Estate, Gift, and Generation-Skipping Transfer Tax Exemption One of the headline changes is the adjustment to the estate, gift, and generation-skipping transfer tax exemption amount for the year 2024. The new figure stands at $13,610,000, representing a significant increase from the previous year’s $12,920,000. This adjustment has crucial implications for individuals planning the transfer of assets, as it means they can now shield an additional $690,000 ($1,380,000 for married couples) from transfer tax liability compared to 2023. Annual Exclusion for Gifts The IRS has raised the annual exclusion for gifts in the calendar year 2024 to $18,000. This is an increase from the 2023 exclusion amount of $17,000. Gifts to Non-Citizen Spouses Another noteworthy adjustment involves gifts to spouses who are not citizens of the United States.
Read More
The Role of a Prenup in Estate Planning
Integrating a Prenuptial Agreement into Your Comprehensive Estate Plan: A Guide for Houston, Texas Couples Estate planning is an essential process for anyone looking to secure their assets and protect their loved ones. One often overlooked aspect of estate planning is the prenuptial agreement, which is an invaluable tool for protecting individual assets and ensuring a smooth distribution of assets in the event of a divorce or separation. In this blog post, we will discuss the importance of incorporating a prenuptial agreement into your comprehensive estate plan and how it can benefit you and your family. Remember, we are always here to help you navigate this process. The Role of Prenuptial Agreements in Estate Planning A prenuptial agreement is a legally binding contract between two individuals before they get married. There is no expiration date on a prenuptial agreement. This agreement can address various financial and personal issues that couples may not agree on, including asset protection, debt management, and inheritance rights. If you do not already have a prenuptial agreement, Including one in your estate planning process helps ensure that your assets and family are well-protected. Protecting Inheritance Rights for Children from Previous Relationships A prenuptial agreement can
Read More
How to Set Up Legacy Contacts
When creating estate plans digital assets- such as Gmail accounts and Facebook- are often overlooked. For many, however, controlling what happens to these assets is a critical component of organizing their affairs. Here are the processes for making sure the right people can access your accounts upon your passing. If you missed our previous blog on other examples of digital assets and why they are important to include in your estate plan, you can read it here. How to Set Up Google If you utilize Google products such as Gmail or Google Drive, you will need to visit the Inactive Account Manager. The first step you will take is selecting an interval of inactivity. The interval of inactivity means how long it has been since you were last active on your Google account and once that time frame has been matched, Google will automatically delete your data. You can set your interval of inactivity for as short as three months to as long as 18 months. The interval of inactivity period means that you have been signed out of Google on your computer, laptop or other devices for the specified time period. Instead of setting up Google to automatically
Read More