Simple Wills & Trusts

EDITOR’S NOTE

The means by which you pass on your financial assets to your descendants is one of the most important legal decisions any Texan can make. People in Dallas, these days, often get too busy to think about these matters. But, if done correctly, either via a simple will or living trust, it can ease the transition at a difficult time for your family. Our Texas estate-planning attorneys have prepared a concise introduction to the topic, highlighting the primary issues and choices. After reading this article you should be better positioned to make an informed decision on the issue of simple wills versus living trusts under Texas law.

Will or Trust?

A “living trust” is often used as a substitute for a will as the primary estate-planning document. A living trust is also a revocable trust, meaning that the individual can change any or all terms of the trust or completely revoke or terminate the trust at any time through his or her life, provided that they have not lost legal capacity. While a will has effect only after an individual dies, a living trust has legal effect at the moment it is created. If assets are properly transferred into the trust, a living trust can prevent the need for a guardianship of the estate if an individual becomes incapacitated later in life. Additionally, after the time of death, the living trust becomes a substitute for a will as the trust document has dispositive provisions, as does a will, as to who receives what assets and under what conditions after the grantor (the person creating the trust) dies.

Generally speaking, the advantages of a living trust over a will are:

  1. It can avoid a guardianship of the estate if an individual later becomes incapacitated, assuming all assets have been transferred to the trust; and
  2. To the extent that all assets have been transferred into the trust and there are no probate assets, there would not be a necessity for a probate proceeding after the individual’s death.

The primary disadvantage is that the preparation of the living trust and the funding of the living trust cost significantly more than does the creation of a basic will. Adding the cost of a probate to the cost of a will could, generally speaking, approximate the cost of preparing a living trust and having it properly funded. The difference in the living trust approach is that the transfer of the assets is done during one’s life and it is not the responsibility of the person left in charge after the person dies. Additionally, the older an individual is when he or she creates a living trust, the greater the likelihood of a possible incapacity which, to the extent assets have been properly transferred to the trust, can be avoided by a living trust.

Additional Considerations:

  1. If an individual owns out-of-state property, a living trust can avoid the necessity of an out-of state probate proceeding to clear title to the property in that state;
  2. With a will, an individual’s probate finances will become public record as the executor of the will is required to file an inventory listing all the decedent’s probate financial interests at the time of death;
  3. To the extent assets have been transferred into the trust, no reference of individual’s assets in public records is required; and
  4. The desire to avoid probate in Texas should perhaps not be as strong as with most other states because Texas probate law provides for an “independent executor” who can act free of court supervision. Accordingly, probate in Texas can cost significantly less than probate in many other states. Nevertheless, there will be legal expenses incurred to have a will admitted to probate.

Will Attorney DallasEach individual client’s situation is evaluated. Depending upon circumstances, a will may sometimes be preferable to a living trust.

EDITOR’S SUMMARY

Hopefully this article has cleared up some of the Texas law regarding estate-planning and probate issues, specifically involving Texas simple wills and Texas living trusts. One point to bear in mind is that there is not a single ‘right’ answer to the question; the best choice reflects both your individual family circumstance and your own desired level of control over your estate. If you would like to investigate these matters further, please reach out to one of our Texas estate-planning attorneys, based in Dallas for a free 45-minute consultation. We are Dallas-based, but serve clients throughout North Texas and from Waco to Abilene to Amarillo to Wichita Falls to East Texas, and everywhere in between.


Estate Planning Questionnaire

Please select one of the options from the dropdown and then fill out the questions that follow. Thanks!

Husband's Info




YesNo















Wife's Info




YesNo













Home Address








InternetFriend



YesNo



Children


YesNo


YesNo

Child









HusbandWifeBoth


MF



Assets



YesNo


YesNo


YesNo




Who do you want to name as the Executor(s) of your estate?

The executor is the person or corporate entity responsible for carrying out the terms of the will and administering the estate.

Husband's Executors









Wife's Executors


Who do you want to name as trustee of any trusts you create for your children or other individual(s)?

A trustee is a person or corporate entity responsible for investing the trust assets, approving distributions from the trust to beneficiaries and otherwise carrying out the terms of the trust.








Who do you want to name as the Guardian(s) of your children (if you have children under age 18)?

Two persons may serve together.








Who do you want to name as agent(s) on your Durable Power of Attorney?

A durable power of attorney gives the person(s) named the power to legally sign your name if you are not able to do so. For instance, it can be used to sign a deed or liquidate a savings account. A power of attorney can be very broad or can be limited. It can also be designed to be in effect immediately after it is signed or to come into effect only after the person creating it has become incapacitated.

Husband's Agent(s)

Agent One







Wife's Agent(s)

Agent One








Who do you want to name as agent(s) on your Medical Power of Attorney?

A medical power of attorney authorizes another person to make healthcare decisions for you if you are unable to do so.

Husband's Agent(s)

Agent One








Wife's Agent(s)

Agent One









Do you want to sign a directive to physicians instructing your doctor(s) to discontinue life sustaining treatment when it is believed that there is no chance of recovery?






YesNo



















InternetFriend



YesNo



Children

Child









MF



Assets



YesNo


YesNo


YesNo




Who do you want to name as the Executor(s) of your estate?

The executor is the person or corporate entity responsible for carrying out the terms of the will and administering your estate.










Who do you want to name as trustee of any trusts you create for your children or other individual(s)?

A trustee is a person or corporate entity responsible for investing the trust assets, approving distributions from the trust to beneficiaries and otherwise carrying out the terms of the trust.








Who do you want to name as the Guardian(s) of your children (if you have children under age 18)?

Two persons may serve together.








Who do you want to name as agent(s) on your Durable Power of Attorney?

A durable power of attorney gives the person(s) named the power to legally sign your name if you are not able to do so. For instance, it can be used to sign a deed or liquidate a savings account. A power of attorney can be very broad or can be limited. It can also be designed to be in effect immediately after it is signed or to come into effect only after the person creating it has become incapacitated.

Agent One








Who do you want to name as agent(s) on your Medical Power of Attorney?

A medical power of attorney authorizes another person to make healthcare decisions for you if you are unable to do so.

Agent One