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Houston Probate & Estate Administration Law Blog

What is a Texas special needs trust?

Texas parents with special needs children are constantly faced with the question of how to provide for the child's expenses. This question is especially vexing when the issue is estate planning. Special needs children often rely on a variety of state and federal programs to provide financial assistance, but eligibility for these programs can often by undercut by estate plans that do not take into account the limits on the child's income and assets that can affect eligibility. The solution to this problem is often provided by a special needs trust.

Special needs children rely on government programs such as Supplemental Security Income, Social Security Disability Insurance, Medicare and Medicaid. These programs limit eligibility to persons who own less than $2,000 in assets. If the child's parents are well off, they often believe that they can simply leave the majority of their assets to their special needs child. Doing so can often have the opposite effect: the sudden increase in a child's net worth can make them ineligible for these programs.

What is estate administration in Texas?

Texas estates come in all shapes and sizes. Some are large, involving thousands perhaps millions of dollars in assets, some are small, comprising only a few thousand dollars in assets. Some estates consist entirely of cash and stocks and bonds, while others include mostly real property. And most estates have debts left by the decedent that must be paid from estate assets. In essence, estate administration in Texas involves the collection of the decedent's assets, payment of debts and distribution of the remainder of the estate to the decedent's heir and other beneficiaries.

Every estate except those will assets of less than $50,000 must be administered by an individual appointed either by the testator in his or her will or by the court if the decedent left no will. The administrator must take an oath to faithfully and accurately carry out his or her fiduciary duties to the court, to the estate and to the beneficiaries. If the decedent left a will and named a person to administer the estate, that person is called the executor; if the decedent died without a will or failed to name an executor, the court will appoint an individual called an administrator to see that the estate is properly managed. For the balance of this post, we will use the term "administrator" to refer to both positions.

Challenging the validity of a will in Texas probate court

Most Texas wills are valid and sail through the probate court without a hitch. Every so often, however, a relative may disagree with the bequests in the will and decide to challenge the validity of the will. A will challenge is perhaps the most contentious form of probate litigation because it often pits one family member against another. For large estates, however, the challenge could be worth thousands or even millions of dollars. The grounds for a successful challenge are not especially complicated.

Perhaps the most common ground for a successful challenge to a will is to prove that the testator failed to follow the formalities prescribed by Texas law. The will may not have been witnessed or properly executed by the person making the will - the testator. If the will is hand-written, the entire will must be in the testator's handwriting. If even one paragraph is in another handwriting, the will might be totally invalidated.

Is an DIY estate plan really in your best interests?

There are numerous and often very personal reasons why people put off creating an estate plan. You may be among those who find it difficult to think about these topics in the privacy of your own home, let alone discussing them with a stranger in a lawyer's officer.

If you are considering trying an online or do-it-yourself will or trust, you may think you have found the perfect solution. However, DIY estate planning has many drawbacks you may not even recognize until it is too late.

Estate planning and annual gifts

Recently on this blog, we discussed the federal estate tax and noted that its exemption is now set at $11.4 million. Since Texas has no state estate tax, and few Texas individuals leave behind an estate worth more than $11.4 million, most Texas families need not concern themselves with estate taxes when they are preparing their estate plans.

However, there are many Texas property owners whose real estate holdings could put their estates above the exemption amount. A feature of many estate plans allows people to avoid estate tax through giving gifts to their loved ones during their lifetimes. By giving the money away during their lifetimes, they reduce their estates below the exemption amount, thus ensuring that their assets avoid the estate tax.

Clearing up some estate tax myths

Estate planning and probate are subjects that can profoundly affect people's lives, and yet they don't come up very often in conversation. One of the few occasions on which the popular news media will discuss the subjects is when there is a courtroom battle over a famous person's will. Another is when there is a political battle over the estate tax.

Partly as a result of this phenomenon, the estate tax is widely believed to be a much bigger deal than it is in reality. In fact, Texas has no estate tax and very few families are affected by the federal estate tax.

What does an estate administrator do?

Under Texas law, people can become administrator of an estate through several ways. Perhaps the most familiar is a situation in which an executor is appointed in the text of the will. In other cases, the court must appoint an administrator. In most of these court-appointed cases, the heirs must agree to the choice of administrator.

An administrator doesn't have to be a lawyer. Technically, the only people who can't be administrators are the incapacitated, felons, nonresidents of Texas, corporations that don't have a Texas agent. Courts can also deem a person unsuitable under other circumstances. Still, the administrator has a legal duty to work in the interest of beneficiaries and creditors. This could potentially make the administrator liable if they behave negligently.

If you own guns, you may need this estate-planning tool

Owning firearms is a right given to you by the Second Amendment to the U.S. Constitution. Even so, you remain responsible for following the laws, rules and regulations that come with that ownership. In fact, in order to own some weapons, you need to receive permission from the federal government.

You follow all the rules and know you won't face any criminal repercussions. However, what happens when you pass away? Do your heirs or beneficiaries have the same protections? No, they don't. In fact, if you leave your weapons to one of your loved ones, they could end up facing felony charges upon taking possession of them.

Report on artist's business reveals risk of undue influence

Peter Max is one of the best-known visual artists in the world. His brightly colored artwork symbolized the pop art and psychedelic art movements of the 1960s and '70s, and has only grown more popular since then. He has been named the official artist for numerous sports events, including the Super Bowl, the World Series and the World Cup, and his work has adorned album covers, U.S. postage stamps and even the side of a cruise ship. Indeed, in recent years many of his works have been sold at galleries aboard cruise ships.

Sadly, news reports indicate that Max, 81, suffers from advanced dementia and hasn't painted anything in years. Nonetheless, many new works have turned out bearing his name.

Handwritten wills create problems in probate court

At the heart of all probate litigation is the quest to uncover the intentions of the deceased. That person is no longer around to answer any questions or clear up any confusion, and so probate courts rely on a written will. This is why courts are so strict about making sure a will meets all the formal requirements before they will accept it as valid. It's also why some of the trickiest issues involve wills that are not entirely clear about the person's intentions.

Recently, the administration of the estate of singer Aretha Franklin was thrown into turmoil by the purported discovery of handwritten documents that may show her intentions for how her estate should be divided.