Month: July 2017

Who Needs to Consider Trusts for their Children in Houston?

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There are a lot of reasons to consider setting up trusts for your children, but trust and estates lawyers in Houston see far too many cases where this just is not done.  One of the biggest reasons for not setting up a trust could be that you feel you do not have enough assets to warrant one.  We hear about “trust fund babies” and automatically think of the super wealthy, not regular folks like ourselves.

Really, though, even those in the middle class should be thinking about setting up trusts for their children.  Even if you do not have a lot of extra money lying around, you have other assets that can quickly add up in value.  Add to that the payout from a life insurance policy, and you suddenly realize that you have quite a bit of financial worth that might be left behind to children who are not ready to handle it.  Anything more than about $100,000 is reasonable to consider putting into a trust for children.

What Does the Trust Do?

When you set up a trust with your trust and estates lawyer in Houston, you will discover that there are many different ways to use this tool.  One of the most important benefits of a trust is that it allows you to stipulate how your children will use the money you leave behind.  If your intention is for your kids to use the money for college, but they want to use it to buy a sports car instead, what is to stop them?

In your case, the trust is what can stop them.  You can implement restrictions on how the money is spent.  You can, for example, determine that the funds in the trust are designated for specific functions, such as paying for education or day-to-day expenses.  In some cases, there is a designated adult to help keep things on track, although this person must be chosen wisely.  In other cases, the parent sets age limits on the trust, assuring that the children do not have access to the money until they have more time to mature.

Protecting the Trust

Another reason to consider a trust is to protect your children’s money from misuse by the adult in charge of the funds.  In the case of a “custodial” account, the person in charge can have a lot more say in how the money is spent.  This could translate into frivolous expenses, including paying himself or herself an unrealistic amount to “manage” the funds.  With a trust, however, the person in charge (the “trustee”) is held more accountable and is required to follow your wishes.

If the trustee does manage the funds poorly, it is also possible that your child would have some legal recourse, as the trust is a legal contract.

Talk to a Houston Trust and Estates Lawyer

The best way to determine if a trust is right for you and family is to talk to a Houston trust and estates lawyer.  Our attorneys are available to sit down with you to review your estate plan and consider how a trust or other estate planning tools can best meet your needs.  To schedule a planning session, call us at (281) 845-8538 and mention this article.

Houston Elder Lawyer: Extra VA Benefits Are Available for Wartime Veterans to Help Pay for Long-Term Care

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Long-term care is expensive, and many seniors in the Greater Houston area struggle to pay for the costs associated with aging and their declining health.  Fortunately for older veterans that served the country during a period of war, additional tax-free benefits may be available through the VA to help offset their out-of-pocket costs.

This benefit is known as the Aid and Attendance Pension, and it is a 3-tiered tax-free benefit for wartime veterans and their spouses who need financial assistance, or simply need help covering the costs associated with long-term care or un-reimbursed medical expenses.

Aid and Attendance is designed for veterans who need help with performing functions of everyday living including, bathing, feeding, dressing, toileting, etc. The benefit can even be used to pay a family member who oversees or provides the care for their loved-one.

There are 4 criteria for eligibility:  service, income, net worth, and medical expenses.  You do not need to have a service-connected disability to qualify.  The VA will look to ensure that you:

  • Are permanently and totally disabled, or 65 or older
  • The veteran must be honorably discharged
  • The veteran must have served at least 90 consecutive days, with at least one (1) day during a period of war.

How to Plan for Eligibility

There are strict income and asset requirements that must be met in order to qualify for Aid and Attendance benefits. However, even if you have assets or money in your name, you still may be able to secure Aid & Attendance benefits.  Similar to Medicaid, the government allows veterans to utilize financial tools and planning strategies with the assistance of an attorney in order to legally reallocate assets to fall within the VA’s guidelines.  Once approved, older veterans and their spouses can be eligible for up to $25,525 per year, tax-free, to help pay for their care.

Get Help When Seeking A & A Benefits!  

Our Houston elder attorneys recognize that securing A & A benefits and working with the VA can be difficult. Many veterans are turned away because they do not understand the VA’s rules or the planning available to help meet the VA’s asset and income requirements.  Our attorneys are available to assist you in order to determine the best legal and financial tools necessary to qualify and quickly help you get the benefits you deserve. To schedule a consultation, simply call our office at (281) 845-8538.

Dealing with Non-Probate Assets| Houston Probate Lawyer

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As a Houston probate lawyer, I am often asked if every asset a person owns will have to go through the probate process when they die. The short answer is that it depends.

While most real estate owned by a person does go through the Harris County probate court following the loss of a loved one, a few asset classes are exempt. They are referred to as non-probate assets.

Instead of being distributed through a will, non-probate assets are automatically transferred to the survivors/beneficiaries, outside of probate. The assets are transferred at the death of the testator regardless of any instructions in the will. As an example, if a husband and wife own a piece of property together, the property is automatically transferred to the surviving partner. There is no distribution of property needed.

There are other assets besides jointly owned assets that are distributed outside of probate. Any assets with a named beneficiary typically avoid probate. Life insurance is one such example where payouts go directly to the beneficiary. In addition, retirement money is a non-probate asset. Life estate and inter vivos trust also are considered non-probate assets.  Here is a brief list of the most common assets that are passed outside of Harris County probate for your reference:

  • Assets held in joint tenancy with rights of survivorship
  • Retirement accounts such as IRAs or 401(k)s that have a beneficiary named
  • Life insurance proceeds that do not have the estate named as a beneficiary
  • Assets held in a living trust
  • Money in a payable-on-death bank account (POD)
  • Securities, bonds, real estate, or other assets with a transfer-on-death provision
  • Pension plan distributions

Remember, non-probate assets are distributed immediately. Simply contacting the bank or company where the asset is located and presenting the death certificate is usually enough to get the ball rolling to distribute the funds. On the flip side, the probate process can take a year or more to get to the point where assets can be distributed to a beneficiary.

The good news is that there are ways to structure your assets so that none of them have to go through probate—even if the assets you are leaving to your loved ones fall outside of this list.  An attorney can help you utilize legal tools and planning to minimize your exposure to probate, or avoid it all together. But, only an experienced estate planning attorney can help you set up your assets to ensure that outcome.

If you would like to speak to a probate lawyer today to set up an estate plan to best protect your assets and minimize the impact of probate court, call our office at (281) 845-8538 to set up a consultation.

 

Houston Will Lawyer: Estate Planning Is About Creating Your Legacy

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As a Houston will lawyer, I would like to talk to you today about one of the most overlooked aspects of estate planning – the opportunity to create your legacy.

Believe it or not, creating a legacy is not all about having libraries and hospitals named after you. There are great ways that you can help your family remember your values and beliefs that will cost you little to nothing.

A very thoughtful (and completely free) way to create your legacy is to write annual letters to your children and other important people in your life.  These letters can be kept with your estate planning documents.  Then, each person will have a special message sharing your feelings and thoughts.

The letters do not have to be held back until your death, either. Many people choose to present the letters to their children upon graduation or on their wedding days.  Estate planning certainly deals with death, but it also gives us a reason to think about life and the way we want to live it.

Another way to create a legacy is to determine important causes in your life and then support them through your estate planning. Whether you are an avid contributor to the American Cancer Society or you have a soft spot for a local animal shelter, these are the kinds of non-profits and charities you can support to ensure your values are represented in your planning.

Many nonprofit organizations will happily work with you to put together some kind of a giving plan for your estate.  There may be tax benefits in addition to knowing that you are doing something important for the world.

A Houston will lawyer can also help you with setting up a family trust that can be used to further causes that you or your loved ones are passionate about.  This is a great way to build a legacy, not just for yourself, but for your entire family.  If you are unsure of how or why you should set up a family trust to create your legacy, definitely take the time to meet with a qualified estate planning lawyer.  He or she will likely have many other suggestions for ways to use your planning in order to help build your legacy.