Houston Estate Planning and Elder Law Attorney Blog

The Sooner You Complete Your Estate Plan, The Better

Published on: January 24, 2019 | By McCulloch & Miller, PLLC

Among the top three reasons for an estate plan are to make sure that your assets are distributed according to your wishes, helping your loved ones from having to pay more taxes than necessary and if possible, avoiding having your estate go through probate.

When there are minor children or family members with special needs, it’s critical to have an estate plan, advises the Capital Press in the article, “Ag Finance: Why you need to do estate planning.”

While it’s likely that most adult children can work things out, even if it’s costly and time-consuming in probate, minor young children need protection. Wills are frequently written, so the estate goes to the child when he or she reaches age 18. However, few teens can manage big property at that age. A trust can help, by directing that the property will be held for the child by a trustee or executor until a set age, like 25 or 30.

What If I Don’t Want My Inheritance?

Published on: January 22, 2019 | By McCulloch & Miller, PLLC

It sounds crazy, but there are many good reasons why someone would not want to receive an inheritance. Making sure that you are not forced to receive assets must be done very carefully, so you’ll need an estate planning attorney on your team.

An estate waiver, also known as an inheritance waiver, releases a person from the right to claim assets in the event of another person’s death. You’ll need such a waiver, if you don’t want to be stuck with state or federal taxes based on the value of the estate, or you don’t want a piece of real estate that is located far from where you live. Another reason for not wanting an inheritance: you may be in the middle of litigation or a divorce and the last thing you want is to increase your assets.

Whatever the reason, this article from Investopedia, “How Inheritance and Estate Tax Waivers Work,” provides some tips to consider when deciding on an inheritance or estate waiver release.

The Difference Between Per Capita And Per Stirpes – Beneficiary Designations

Published on: January 17, 2019 | By McCulloch & Miller, PLLC

Out-of-date beneficiary designations could completely undo your entire estate plan. It happens often, since people often neglect these ‘fine print’ details.

We hope that you have a will to ensure that your assets are distributed according to your wishes after you pass. However, if you are like most Americans, many of your assets are not distributed through your will, but through a beneficiary designation, which you may have not thought about since opening up the account, retirement account, 401(k), IRA or SEP or taking out a life insurance policy. A word of warning: regardless of what’s in your will, the beneficiary designation takes precedence.

Benzinga’s recent article addresses this question: “Estate Planning: What Are Per Capita And Per Stirpes Beneficiary Designations?” Have you changed the beneficiary designations, since the account or policy was first started? If you need to update your beneficiary designation, talk to the company responsible for maintaining the account. They’ll send you a form to complete, sign and return. Keep a copy for your own records.

What Happens When an Heir Predeceases the Parent?

Published on: January 15, 2019 | By McCulloch & Miller, PLLC

If your will does not address this issue, then your state’s laws will be applied. Speak to an experienced Houston estate planning attorney to see about Texas heir laws.

Estate planning attorneys deal with unexpected issues all of the time, and by their nature, some of them involve sensitive and sad topics. A recent article in The Carroll County Times addressed the question of what happens when a child predeceases a parent. The article, “Legal Matters: If predeceased by an heir in a valid will, what happens with that inheritance?” explains that a will can be prepared for this possibility, and a will can also be changed, if this was not previously considered.

As an example, the Maryland Estate and Trusts Code says “[u]nless a contrary intent is expressly indicated in the will, a legacy may not lapse or fail because of the death of a legatee after the execution of the will but prior to the death of the testator.”

What Are the Rules About Inheriting an IRA?

Published on: January 10, 2019 | By McCulloch & Miller, PLLC

The rules are strict, and mistakes can be costly.

Inheriting an IRA is not like inheriting any other asset. You’ll need to be very careful to follow the rules. Usually the parent is the beneficiary and the children (grandchildren) are successor beneficiaries. Here’s how it works, as described in nj.com’s recent article, “Inheriting an inherited IRA? Your payout choices will be limited.”

Per IRS rules, if you die prior to withdrawing all the funds from an inherited IRA, then the beneficiaries are bound by the same Required Minimum Distribution (RMD) schedule that they’d chosen when they inherited it.

Why Do I Need to Have Power of Attorney Forms?

Published on: January 8, 2019 | By McCulloch & Miller, PLLC

There are a number of different estate planning documents that are easily confused, including “Power of Attorney.” Let’s get a look at the different types of “Power of Attorney,” and what they do.

Of the estate planning documents, most people have heard of a will and some have a health care proxy. The Power of Attorney is effective while you are still living, and is also known as a “Durable Power of Attorney” because it is effective, or durable, even after you become incapacitated. Your will only becomes effective when you die.

The Times Herald says in the article “Powers of attorney good for life and beyond” that there are two general types of powers of attorney, one for financial matters and the other for health care matters. They shouldn’t be combined in a single document, because they have different legal requirements. Unless they say otherwise in the document, powers of attorney don’t expire until the creator does. However, there are a few powers in both financial and health care powers of attorney that can survive the person who created the document.

Born in the USA, But Want to Retire in the U.K.?

Published on: January 4, 2019 | By McCulloch & Miller, PLLC

Many people contemplate retiring in Europe, to enjoy the company of relatives, a lower price of living or to explore countries they’ve always wanted to see. Here's what you should know if the U.K. is on your retirement radar.

Despite a common language and shared history, life in the U.K. is quite different than life in the U.S. It’s not just that it rains more, or that they drive on the left side of the road. There are cultural differences that can take some time to adjust to. However, as Investopedia points out, there are some advantages to retirees, in the article “How to Retire in the U.K. as an American.”

Required Paperwork. Americans are permitted to spend time in the U.K. as tourists and stay up to six months without a visa. To stay longer, an American must qualify for a visa. Family connections, established U.K. business connections, or dual citizenship with a Commonwealth country, like Canada, may help. However, owning property doesn’t guarantee a longer visa term. The British government does have a special entrance category for “retired persons of independent means.” This is defined as those having a minimum yearly disposable income of £25,000 (about $31,000) and several other requirements.

What Singles Need to Know About the Tax Cuts and Jobs Act

Published on: January 3, 2019 | By McCulloch & Miller, PLLC

Single with a net worth less than $11.4 million in 2019? You’re in luck—you can die knowing that all of your money will pass free of any federal estate tax to your heirs.

It was good news for the wealthy—the Tax Cuts and Jobs Act (TCJA) amped up the unified federal estate and gift tax exemption to $11.4 million for 2019 (and up to $11.18 million in 2018). If that wasn’t generous enough, those exemptions will be increased annually for inflation from 2020 to 2025. As comedian Mel Brooks would say, “It’s good to be the king.”

MarketWatch’s recent article, “How single folks should handle estate-tax planning under the new tax law,” explains that taxable estates above the exemption will have the excess taxed at a flat 40% rate. An individual’s cumulative lifetime taxable gifts in excess of the exemption are taxed at the 40% rate. Likewise, taxable gifts are those that are more than the annual federal gift tax exclusion of $15,000 for 2018 and 2019.

A Love Story: George and Barbara Bush

Published on: January 2, 2019 | By McCulloch & Miller, PLLC

Their lives were devoted to family and public service, and to each other. The passing of George H.W. Bush and his wife gave many Americans pause to consider their leadership and their devotion.

Few were surprised when George H.W. Bush passed less than eight months after Barbara’s death. Their deep connection—from his service in World War II to the Presidency and their role in public service after leaving the White House—was evident to everyone around them, says Forbes in the article, “Valuable Estate Lessons From The Passing Of George And Barbara Bush.”

The death of a longtime married couple in quick succession, is often called “broken-heart syndrome” or “widowhood effect.” The thought is that the lives of two people are so entwined they can’t bear to be without each other. The time between the Bushes’ deaths also raises practical questions in estate planning. Timing is critical in an estate plan, and if the deaths of married spouses happen within a short period of time, it can make the administration of an estate more difficult.

When Disaster Strikes, Will Your Estate Be Ready?

Published on: December 31, 2018 | By McCulloch & Miller, PLLC

The swiftness of fires and flood in the news in recent months, even in places that have never experienced dramatic disasters, puts a spotlight on the need for preparedness. That includes your estate plan.

The evening news presents enough reminders about the need to plan for disasters. However, many people feel like it can’t happen to them, or they don’t know what to do. Forbes’s recent article, “How To Make Your Estate Plan Doomsday Ready,” looks at a couple in their 80s, who recently had their house in North Carolina destroyed by Hurricane Florence, and the picture of what has occurred should be a life lesson for all.

This couple depended on their adult children, who were all in other states, to help—but there were many obstacles. They didn’t have access to a computer and couldn’t remember account information or their passwords or even how to access their email. They asked their daughter to go online and pretend to be them, to begin accessing information. OK, that may not be legal, but desperate times can call for desperate measures.