Estate Planning
A Will is a legal document that tells your beneficiaries, such as your family and friends, and the probate court, what your plans are concerning the management and distribution of your assets after you die (your “estate”). The person making the Will also appoints an Executor. In Texas, the Executor is responsible for offering the Will for probate to the probate court or county court at law. Once the Will is admitted to probate and the court “qualifies” the Executor, the Executor will be responsible for collecting the assets in your estate, paying the debts of your estate, and distributing any remaining estate assets to your beneficiaries.
To be valid, a Will must be signed by the person making the will and two “disinterested” witnesses who were in the presence of the person signing the Will when the Will was signed. A probate court can refuse to accept a Will for probate if the Will was not signed properly or the person making the Will did not follow all the formalities for signing a Will as required by Texas law. If that happens, then it is as if the person never had a Will! To avoid this situation, it is best to consult with an estate planning attorney when making a Will.
Wills containing self-proving affidavits are helpful when for when the Will is offered for probate. A self-proving affidavit tells the probate court that the Will was properly signed with all the formalities required by Texas law. The self-proving affidavit is signed by the person making the will, the witnesses, and a notary. If the Will does not contain a self-proving affidavit, then the witnesses will have to appear in probate court when it is time to probate the Will. This could be a problem if the witnesses can no longer be located or are also dead.
An estate planning attorney with Law Office of Adriane S. Grace, PLLC can assist you with not only drafting your Will but ensuring that the Will is signed and witnessed correctly and contains an accurate self-proving affidavit that follows all the formalities required by law.
A holographic Will is a handwritten Will. To be valid in Texas, a holographic Will must be entirely in the handwriting of the person making the Will, must be signed by the person making, the Will, and must contain testamentary intent. A signed holographic Will can be offered for probate, but additional legal proceedings may be required so that the court can construe, or interpret, the holographic Will if the plan of the person making the Will is unclear or ambiguous.
Estate Planning attorneys draft Wills for individuals who want to plan for their families and their estate after death. An Estate Planning attorney is knowledgeable about the laws concerning estate distribution and estate administration and know what language to use in the Will to accomplish an individual’s estate planning goals. Estate planning attorneys also know what language a probate court or county court at law will expect to see in a properly drafted Will. Probate courts and county courts at law who hear probate cases are local to each county. Therefore, forms offered for sale on the Internet or by national companies may not contain the language that your local probate court or county court at law prefers.
If you have questions about the probate process in your county and how to make a Will that is likely to be admitted to probate in your county, contact an estate planning attorney at the Law Office of Adriane S. Grace, PLLC to discuss your Will and estate planning needs.
A revocable living trust is a document separate from a Will that allows you to administer and distribute your estate assets during your lifetime and after death. A revocable living trust is a trust that can be amended, changed, or revoked during the lifetime of the person making a trust. All living trusts in Texas are presumed to be revocable unless the trust document, or trust agreement, states otherwise.
To create a revocable living trust, a person making a trust, also called a “Settlor” or “Grantor”, makes a gift of property to the trust for a “Trustee” to manage. This property can be personal property and/or real property such as a house or real estate. The settlor/grantor and the trustee can be the same person and often are when the grantor is making the trust to manage their own estate assets. In the state of Texas, a settlor or grantor must execute and sign a deed to transfer property to a trust, otherwise, the property is not considered a part of the trust.
A trustee is responsible for carrying out the terms of the trust. A trustee is considered a fiduciary. A trustee has many fiduciary duties and could be held personally liable for violating his or her fiduciary duties or breaching the trust agreement by not administering the trust in accordance with trust terms. Thus, it is important when making a trust to consult with an estate planning attorney about the terms of the trust and the duties of the trustee.
A revocable living trust does not necessarily avoid probate in the state of Texas. When a person dies, they often leave debts and other unpaid bills including medical, funeral, and last expenses of living. Once a person dies, these debts become the debts of the deceased person’s estate. Debts of an estate must be administered and paid through an estate administration in the state of Texas and this legal process requires probate. Therefore, a person making a trust should consult an estate planning attorney about also creating a Will that can be offered for probate in Texas.
A revocable living trust, however, may help with avoiding probate in multiple states if a person owns real property located in other states. A revocable living trust can also be used for privacy reasons if a person wants to keep the contents of their estate, or their asset information, private. You should consult with an estate planning attorney on the benefits of using a revocable living trust. An estate planning attorney with Law Office of Adriane S. Grace, PLLC can provide advice and counsel on whether a revocable living trust is advisable under Texas trust laws and whether it can be used to accomplish your particular estate planning goals.
A testamentary trust is a trust created by a Will. A testamentary trust is not activated until the person who made the Will dies and the Will has been admitted to probate. A testamentary trust is one way to provide for a surviving spouse and children during their lifetime, while still controlling the ultimate disposition of estate assets after the death of the lifetime beneficiaries. A testamentary trust is often used in the context of minor children who cannot otherwise receive money due to legal disability (being under the age of 18). A testamentary trust is also used in the context of blended families where a surviving spouse is not also the parent of the children of the person making the Will. A revocable living trust could also be used for these same reasons and thus it is important to talk to an estate planning attorney about when to use a revocable living trust or a testamentary trust, or whether both may be required.
Since a testamentary trust is not valid until the person making the Will dies, there is no grant of property to a testamentary trust during lifetime. However, the person making the Will is responsible for selecting a Trustee to manage and administer the trust assets and appointing an Executor in the Will who will then be responsible for delivering estate assets to the trustee of the testamentary trust.
A trustee is responsible for carrying out the terms of the trust. A trustee is considered a fiduciary. A trustee has many fiduciary duties and could be held personally liable for violating his or her fiduciary duties or breaching the trust by not administering the trust in accordance with trust terms. Thus, it is important when making a testamentary trust to consult with an estate planning attorney about the terms of the testamentary trust, who will be the trustee of the testamentary trust, and the duties of the trustee.
An estate planning attorney with Law Office of Adriane S. Grace, PLLC can provide counsel and advise about the terms of the testamentary trust and who you should appoint to serve in the role as Executor and Trustee.
A special needs trust is also called a supplemental needs trust and is a trust that provides for the supplemental needs of a disabled individual who will qualify for needs-based public assistance such as Supplemental Security Income (SSI) or Medicaid. A special needs trust can be a living trust or a testamentary trust. Special needs trusts must contain specific language to be considered a special needs trust for purposes of the Medicaid and SSI benefit programs. An estate planning attorney can assist with drafting a special needs trust using the required terms.
A person making a Will who wants to name a beneficiary currently receiving SSI or Medicaid may, instead, want to consider creating a special needs trust for that beneficiary. An individual who has plans to apply for SSI or Medicaid and anticipates receiving an inheritance or other large financial windfall may, instead, want to consider using a special needs trust.
A person making a special needs trust can choose a trustee of the trust. A trustee is responsible for carrying out the terms of the trust. A trustee is considered a fiduciary. A trustee has many fiduciary duties and may be held personally liable for violating his or her fiduciary duties by not administering the trust in accordance with trust terms. A trustee of a special needs trust has the additional responsibility of making sure a distribution from the trust does not cause the trust beneficiary to lose his or her SSI or Medicaid benefits. There are many non-profit organizations and corporate organizations, including banks, who are willing to serve as trustee of a special needs trust. These organizations have knowledge about how to make trust distributions that can help the beneficiary while also maintaining the trust beneficiary’s eligibility to received SSI or Medicaid benefits.
Thus, it is important when making a special needs trust to consult with an estate planning attorney about who should serve as the trustee of a special needs trust, the terms of the special needs trust, and the duties of the trustee of a special needs trust.
An estate planning attorney with Law Office of Adriane S. Grace, PLLC can assist you with determining whether a special needs trust is advisable and can assist with drafting a special needs trust under Texas trust law.
In Texas, a person who wants to appoint someone else to act on his or her behalf in financial transactions can use a statutory durable power of attorney. The person making the durable power of attorney is called the “Principal”. And the person appointed by the Principal to act on the Principal’s behalf on the financial transactions, is called the “Agent”. A durable power of attorney authorizes an agent to engage in certain financial transactions on behalf of the principal.
To be valid in Texas, a durable power of attorney must be signed by the Principal (or by someone he directs to sign in his presence if he is physically unable to sign) and his signature must be acknowledged by a notary.
A true durable power of attorney becomes effective once the principal signs the durable power of attorney and is not affected by the principal’s later incapacity. A power of attorney that is effective only in the event of the principal’s incapacity is called a “springing power of attorney”.
An agent acting under a durable power of attorney is considered a fiduciary. An agent acting under a durable power of attorney has many fiduciary duties and could be held personally liable for violating his or her fiduciary duties. Although a durable power of attorney can be a very helpful tool for families needing to assist a loved one, a durable power of attorney can be easily abused by an unscrupulous agent. Principals with underlying medical conditions that cause physical or mental disability are particularly vulnerable to financial exploitation by self-interested and irresponsible agents. Thus, it is important when making a durable power of attorney to consult with an estate planning attorney about the terms of the durable power of attorney, who will act as the agent under the durable power of attorney, and what transactions and powers the agent should have under the durable power of attorney. Law Office of Adriane S. Grace, PLLC provides assistance and advice with Durable Power of Attorney documents.
In Texas, a person who wants to appoint someone else to make medical treatment decisions on his or her behalf can use a medical power of attorney. The person making the medical power of attorney is called the “Principal”. And the person appointed by the Principal to act on the Principal’s behalf to make medical decisions, is called the “Agent”. A medical power of attorney authorizes an agent to make medical treatment decisions on behalf of the principal when the principal is unable to make those decisions. A doctor must first certify in writing that the principal is “incapacitated”—unable to make medical treatment decisions for his or herself—for the medical power of attorney to be effective. Once the doctor certifies that the principal is incapacitated, then the agent can make the medical treatment decisions.
A medical power of attorney does not allow the agent to commit the principal to a psychiatric facility. A medical power of attorney does not allow the agent to consent to an abortion on behalf of the principal. A medical power of attorney does not allow the agent to move the principal to a residential care facility. If the agent wants to take these actions on behalf of the principal, the agent will need to apply to a court of competent jurisdiction and obtain authority from the court to make those decisions on behalf of the principal. A guardianship attorney can advise about the appropriate legal proceeding and assist an agent who wants to apply to the court for this kind of decision-making authority.
A medical power of attorney must be signed by the Principal and two witnesses. The medical power of attorney can also be signed by a notary in lieu of two witnesses.
An agent acting under a medical power of attorney is considered a fiduciary. An agent acting under a medical power of attorney has many fiduciary duties and could be held personally liable for violating his or her fiduciary duties. Although a medical power of attorney can be a very helpful tool for families needing to assist a loved one, a medical power of attorney can be easily abused by an unscrupulous agent. Principals with underlying medical conditions that cause physical or mental disability are particularly vulnerable to exploitation by self-interested and irresponsible agents.
Thus, it is important when making a medical power of attorney to consult with an estate planning attorney about who should act as an agent under the medical power of attorney, and if there should be any limitations on the agent’s decision-making authority under the medical power of attorney. An estate planning attorney with Law Office of Adriane S. Grace, PLLC can also assist you with executing and signing a medical power of attorney in accordance with Texas law.
Before a person becomes incapacitated, they can state in advance, their wishes for end-of-life care and treatment. This legal document, sometimes called a “living will” or “advance medical directive” is known in Texas as a “Directive to Physicians and Family or Surrogates”. Hospitals and treating physicians often ask patients when they come in for a surgery, or other medical procedure requiring sedation, whether they have an advance medical directive.
An advance medical directive informs your agent acting under a medical power of attorney, and your family and physicians, how you want to be cared for if you are in a “terminal condition” or “irreversible condition” due to some medical condition, illness, or disease, and are incapacitated—unable to make medical decisions for yourself. In an advance medical directive, you can tell your agent, family, and physicians whether you want to die gently and receive comfort treatment only, or if you want to be kept alive using all available “life-sustaining treatment”, in the event you are in a “terminal condition” or “irreversible condition”.
Life-sustaining treatment includes both life-sustaining medications and artificial life support such as mechanical breathing machines, kidney dialysis treatment, and artificially administered nutrition and hydration (a tube inserted through the vein or gastrointestinal tract to administer food and water). Comfort treatment includes administration of pain management medication, the performance of a medical procedure necessary to provide comfort care, or any other medical care provided to alleviate a person’s pain.
An advance medical directive must be signed by the individual and two witnesses. The advance medical directive can also be signed by a notary in lieu of two witnesses. You can consult an estate planning attorney with the Law Office of Adriane S. Grace, PLLC to discuss the legal effect of signing an advance medical directive and to obtain assistance with executing and signing an advance medical directive in accordance with Texas law.
When a person is unable to care for themselves, or their property and finances, due to a mental disability or severe physical disability, a guardianship may be necessary. A guardianship is a legal proceeding. When a court determines that a person is incapacitated—unable to care for themselves or their property—the court will appoint a guardian to make decisions regarding the incapacitated person’s care and finances. Before a person becomes incapacitated, however, they can state in advance who they would want to serve as their guardian in the event of later incapacity. This written statement is a legal document called a “Declaration of Guardian in the Event of Later Incapacity or Need of Guardian”. Once a person makes the declaration, a court must honor the person’s designation of guardian as long as the designated individual can qualify under the law to serve as a guardian. Additionally, a person making a Declaration of Guardian can disqualify an individual, who might otherwise be eligible to be selected as guardian, from serving as their guardian. Some people may find this useful if they have family members who they do not trust or who are not responsible with managing money.
Just like a medical power of attorney and durable power of attorney, a Declaration of Guardian must be signed by the person making it and notarized. In cases where a person is being disqualified from serving as guardian, the Declaration of Guardian must also be witnessed.
A guardian is a fiduciary and must meet the legal definition of eligibility to serve as guardian, under Texas law, to be appointed as a guardian. An estate planning attorney with Law Office of Adriane S. Grace, PLLC can advise you about who is eligible to serve as guardian under Texas guardianship law and assist you with making a Declaration of Guardian that is signed and witnessed in accordance with Texas guardianship law.
A Transfer on Death Deed or “TODD” is a legal document that transfers an owner’s interest in real property, or real estate, to someone else upon the owner’s death. To be valid under Texas law, a Transfer on Death Deed must be in writing, signed by the property owner, notarized, and recorded in the county property records prior to the property owner’s death.
At the death of the property owner, real estate subject to a recorded Transfer on Death Deed passes to the person so designated on the deed (the “beneficiary”) outside of probate. Therefore, the provisions of a Will or Trust have no effect on a Transfer on Death Deed. A Transfer on Death Deed does not give the beneficiary under the deed any interest in the property during the property owner’s lifetime. Therefore, a beneficiary’s creditors can have no interest in the property during the property owner’s lifetime. A transfer on death deed does not affect any liens or mortgages on the property or the property owner’s ability to subject the property to a lien or mortgage. Thus, when the property owner dies, the real property passes to the beneficiary under the deed, subject to any pre-existing liens or mortgages.
The beneficiary of a Transfer on Death Deed must survive the property owner by 120 hours to receive the property. A Transfer on Death Deed can also list a contingent beneficiary, who is the person that would receive the property if the primary beneficiary does not survive. Additionally, a property owner can designate multiple beneficiaries under a Transfer on Death Deed. However, Texas law does not provide for unequal shares under a Transfer on Death Deed. Therefore, if multiple beneficiaries are named on a Transfer on Death Deed, the beneficiaries will own an undivided equal share of the real estate at the death of the property owner.
Because a Transfer on Death Deed does not transfer any interest during the property owner’s lifetime, the deed can be revoked at any time during the property owner’s lifetime. However, revocation of the Transfer on Death Deed must also be in writing, signed, and recorded in the same county property (deed) records as the original deed. A Transfer on Death Deed can also be revoked by a subsequent Transfer on Death Deed that states an intent to revoke the prior deed and that follows all the same writing and recording formalities as the first Transfer on Death Deed.
A Transfer on Death Deed can be a useful tool for a person who wants to transfer real estate while “avoiding” the probate process. However, there are many rules that must be followed to make a valid Transfer on Death Deed. Additionally, Texas law places limitations on how a Transfer on Death Deed can be used. Therefore, you should consult with an estate planning attorney about whether a Transfer on Death Deed can accomplish your individual estate planning goals. An estate planning attorney with Law Office of Adriane S. Grace, PLLC can also assist with drafting a valid Transfer on Death Deed and with making sure the Transfer on Death Deed is signed, notarized, and recorded in accordance with Texas property laws.
An Enhanced Life Estate Deed or “Ladybird Deed” is a legal document that transfers interest in real property, or real estate, to someone else during the owner’s lifetime while reserving property rights to the original owner. Under a Ladybird Deed, the original owner of the property or “Grantor” retains a life estate in the real property, as well as the right to sell the property and retain the proceeds of the sale of the real properyt. The person to whom the property is transferred, or “Grantee”, under a Ladybird Deed receives all of the remaining interest in the real property. At the death of the Grantor, all interest in the property under a Ladybird Deed belongs to the Grantee, but only if the Grantor did not sell the property or otherwise transfer his remaining interest to someone else during lifetime through a concurrently or subsequently executed Will, Trust, or other legal instrument.
A Ladybird Deed is signed by the Grantor and is often notarized and recorded in the county deed records much like any other deed. A benefit of the Ladybird Deed, much like the Transfer on Death Deed, is that it can potentially operate to transfer real property to someone else outside of the probate process.
However, a Ladybird Deed is not a creature of Texas statute. Therefore, some title companies may refuse to insure title to real property subject to a Ladybird Deed if the deed is poorly worded, ambiguous, is not also signed by the Grantee, is signed by an agent under a power of attorney instead of the Grantor, or does not contain warranty of title, among other reasons. In other words, a Ladybird Deed is a complicated legal instrument and the legal effect of making a Ladybird Deed should be discussed with an estate planning attorney or other legal counsel prior to executing such a deed. Law Office of Adriane S. Grace, PLLC provides assistance and counsel with Ladybird Deed documents.
Texas is a “community property” state. With few exceptions, in the state of Texas, any property acquired during the marriage and all income earned during the marriage is presumptively “community property”. Each spouse owns a one-half (1/2) undivided share of the community property. Thus, it follows under Texas law that each spouse has a right to dispose of their one-half (1/2) community property share by a Will, Trust, or even a marital agreement.
Our Texas state constitution allows for spouses to make marital agreements amongst themselves concerning the division of the marital and non-marital estate. One type of marital agreement that is most commonly known and understood is a “pre-marital” or “pre-nuptial” agreement. In Texas, spouses can make agreements between themselves at any time during their marriage concerning the division of the community property and any separate property they own.
Questions about community property laws come up more often at the death of a spouse than during a divorce. In the state of Texas, the distribution of marital property during a divorce is a “just and right” distribution. At death, however, and in the absence of a marital agreement or Will, Texas community property laws apply. Texas probate and estate administration laws concerning who is to receive the deceased spouse’s 1/2 interest in the community property differ, depending on whether the surviving spouse is also the parent of all of the deceased spouse’s children, and whether the property in question is personal property or real property (real estate).
An estate planning attorney can assist and advise you about Texas community property laws and whether a marital agreement should be a part of your estate plan. An estate planning attorney with Law Office of Adriane S. Grace, PLLC can also draft a marital agreement and provide advice and counsel if you have been offered a pre-marital, or pre-nuptial agreement in consideration of a marriage proposal.
Probate and Estate Administration
Estate Administration is the legal process for collecting the assets of a deceased person; paying their creditors, outstanding bills, funeral expenses, and expenses of last illness; and distributing the remaining assets to the deceased person’s heirs at law, or beneficiaries under a Will. The individual acting on behalf an estate is called an Administrator.
A person seeking to be appointed Administrator of an estate must hire a probate attorney to assist them because a legal proceeding is required for an Administrator to be appointed on an estate. In Texas, only probate courts or county courts at law have authority to appoint an Administrator of a deceased person’s estate. It is these courts’ responsibility to ensure that the Administrator is a person eligible to act as Administrator of the deceased person’s estate and that they can qualify to act as Administrator under Texas probate and estate administration laws. Because an Administrator is considered a fiduciary, they must be represented by a probate attorney when applying to the court to be appointed Administrator and when taking certain actions on behalf of the deceased person’s estate. When a person is authorized by the court to act as Administrator of an estate, they receive “Letters of Administration”, which is their license to deal with third parties in relation to the estate.
In Texas, there are two types of administration: dependent administration and independent administration. In a dependent administration, the Administrator must have the court’s permission to take any action as it concerns the estate, including when and whether they can sell estate property, pay the debts of the estate, and distribute any remaining assets to the heirs at law, or beneficiaries under a Will. A dependent administrator must also be able to “bond”. Because of all the legal requirements involved in a dependent administration, this type of administration is the mostly costly and time-consuming. An estate planning attorney can assist you with creating an estate plan that avoids probate with a dependent administration.
In an independent administration, the Administrator can act “independent” of the court including on such tasks as collecting and selling estate property, paying creditors, and distributing estate assets. However, an independent administration can only be created under a Will or by agreement of all the distributees of a deceased person’s estate. Not only must they agree on the advisability of an independent administration, but also on who will act as the “Independent Administrator”. This is generally not an issue when the heirs are close members of the same family, such as adult children who are also biological siblings, or adult children and a surviving spouse who is also the biological parent of the adult children. But when the heirs are “split” as in the case of a blended family, agreement can be difficult, if not impossible to achieve.
When a loved one passes away, a probate attorney with Law Office of Adriane S. Grace, PLLC can assist you with determining whether an administration of the estate is necessary and what type of administration can be accomplished given the type of assets and the family relationships involved.
Probate of a Will with Letters Testamentary is probate of a Will with an estate administration. However, Letters Testamentary are only given to a person named in a Will to act as “Executor”, and only after the Will has been admitted to probate and the named person has “qualified” to act as Executor under Texas probate and estate administration laws.
In Texas, only probate courts or county courts at law have authority to admit a Will to probate and appoint an Executor of a deceased person’s estate. It is these courts’ responsibility to ensure that the named Executor in the Will is a person eligible to act as Executor of the deceased person’s estate and that they can also qualify to act as Executor under Texas probate and estate administration laws. Because an Executor is considered a fiduciary, they must be represented by a probate attorney when applying to the court to be appointed Executor and when taking certain actions on behalf of the deceased person’s estate. Once a person is authorized by the court to act as Executor of an estate, they receive “Letters Testamentary”, which is their license to deal with third parties in relation to the estate.
If the Will contains special language allowing the Executor to act without the supervision of the court, then the person may be appointed as an “Independent Executor”. Having an Independent Executor is essentially the same as having an independent administration. In an independent administration, the Administrator can act “independent” of the court including on such tasks as collecting and selling estate property, paying creditors, and distributing estate assets. A probate attorney with Law Office of Adriane S. Grace, PLLC can assist a person name in a Will to serve as “Executor” with the legal proceedings necessary to admit the Will to probate and become a duly-appointed Executor of an estate.
Muniment of Title is probate of a Will without an estate administration and solely for the purpose of transferring title in property to the beneficiaries named in a Will. Since there is no administration, the only requirement is to have the Will admitted to probate by the probate court or county court at law. Muniment of Title is a probate procedure unique to Texas probate laws. There are many financial institutions that do not recognize and understand Muniment of Title. These financial institutions may require the beneficiaries under a Will to present them with “Letters Testamentary” or “Letters of Administration” before they will pay out a bank account, brokerage account, or retirement account to a deceased person’s beneficiaries under the Will. Law Office of Adriane S. Grace, PLLC can assist you and advise you about whether Probate of a Will as Muniment of Title is an available option under Texas probate laws or whether an estate administration is necessary.
When a person dies without a Will and an estate administration is needed, a judicial determination of the deceased person’s heirs at law will also be required. The legal process for determining a deceased person’s heirs at law is called an Heirship Determination. Texas probate courts and county courts at law are the only courts that have authority to determine a deceased person’s heirs at law. Anyone applying for an Heirship Determination must be represented by a probate attorney.
When a person dies without a Will, Texas inheritance and probate laws determine who inherits the deceased person’s property. Further, under Texas probate laws, an heir’s relationship to the deceased person will determine what property they receive as well as the fractional interest in the property that they receive. Generally, it is the spouse, children, grandchildren, parents, and siblings of a deceased person who are the heirs at law under Texas probate laws. If a person dies not having any of these people in their life, then the probate court will look to the deceased person’s grandparents and the descendants of their grandparents as possible heirs, such as aunts, uncles, cousins, and other distant relatives (sometimes referred to a “laughing heirs”).
Notably, live-in partners and longtime boyfriends/girlfriends and significant others are excluded from the statutory definition of an “heir”. Also excluded from the statutory definition of an heir are step-children and other step-family members. Therefore, if you have someone important in your life who you would like to inherit your property at death, instead of your next of kin, you should contact an estate planning attorney about making a Will. A well-drafted Will and estate plan avoids an Heirship Determination. Law Office of Adriane S. Grace, PLLC offers estate planning and legal counsel concerning heirship determinations.
Will Contests generally occur when a beneficiary under a Will, or a legal heir under Texas probate laws, does not believe that a Will that has been offered (or admitted) to probate, is a valid Will. Some reasons a Will may be invalid is if it was not signed with all the correct formalities required by law; or if the person making the Will lacked capacity to make the Will at the time the Will was signed; or if the Will was the product of someone else’s undue influence.
Lack of testamentary capacity (incapacity) is a question of law but is also very fact dependent. A person lacks testamentary capacity if they are suffering from a mental condition that prevents them from understanding the nature and extent of their property, the identity of their natural heirs, and/or the business they are transacting. A probate lawyer can assist and advise on whether there are sufficient facts to make a Will contest claim based on lack of testamentary capacity.
Similarly, undue influence claims are fact dependent. Undue influence can occur when one person influences another to make a Will, or a gift under a Will, that is contrary to what the person would have done, but for the undue influence. There are some situations and relationships that presumptively raise the question of undue influence. A probate attorney can advise you about the possibility of whether a Will, or a gift made under a Will, was the product of undue influence.
There are other types of Will contests that don’t involve challenging the gifts of property made under the Will, such as challenging the person appointed under a Will to serve as Executor. One type of challenge is if the person named as Executor in the Will is not eligible to serve under Texas probate and estate administration laws, or otherwise lacks the qualifications to serve as Executor. An Executor can also be challenged in probate court even after they have been qualified by a probate court to serve as Executor if they are not fulfilling their duties and responsibilities under Texas estate administration laws. A probate attorney with Law Office of Adriane S. Grace, PLLC can advise about the duties and responsibilities of an Executor under Texas probate and estate administration laws and whether there is an available legal proceeding to challenge the appointment of the Executor.
Finally, other types of Will contests involve challenging the omission of heirs from a Will who are otherwise legally entitled to inherit a deceased person’s property under Texas probate laws. These heirs include the spouse and/or minor children of a deceased person. If a person has not updated a Will to include a new spouse or later-born child, a cause of action may be brought by these heirs, or their legal guardian, to challenge a gift of property made under an earlier Will that was offered (or admitted) to probate after the spouse/parent’s death. In some cases, it may also be necessary to prove the relationship of this heir to the deceased person when making such a challenge. This is especially true in the case of a common law marriage, or a child whose paternity was never established during the lifetime of the now-deceased parent. A probate attorney with Law Office of Adriane S. Grace, PLLC can advise and assist with Will contests based on an omitted heir such as a spouse or minor child.
Sometimes things do not go as planned in probate. Estate administration disputes occur when families are so divided that they cannot even agree about who should be the administrator of an estate. Other times, the issue is that someone in the family was appointed the estate administrator, but then failed to do their job correctly. More complications can arise if there is community property involved and there are disagreements between the heirs about the categorization of property as community property or separate property, and how to divide such property under Texas community property laws.
Either way, these probate disputes only lead to increased administration expenses and further delays in distributing the assets to the heirs. A probate attorney can assist families with implementing solutions to quiet these disputes. Solutions can include a family settlement agreement, qualifying a third party to serve as administrator, or obtaining additional court supervision over the actions of the existing court-appointed administrator. Each problem requires a different solution and a probate attorney with Law Office of Adriane S. Grace, PLLC can assist families with crafting the right solution to solve your estate administration issues.
Guardianship
Recent changes in Texas guardianship laws require potential guardians and caregivers of disabled individuals to first consider and implement available alternatives to guardianship. Oftentimes, these disabled individuals are young adults with mental disabilities and other special needs who may require continued assistance throughout their adult lives. One alternative to guardianship that may be available for these individuals is a Supported Decision-Making Agreement.
A Supported Decision-Making agreement is legally recognized in the state of Texas. This is a special agreement between the supporter and the disabled person that gives the supporter legal authority to assist the individual with making decisions as it pertains to, or involves, a third party. It differs from a power of attorney because it allows the supporter to make decisions with the adult instead of independent of them.
These agreements are not a substitute for a power of attorney. Whether a Supported Decision-Making agreement is a feasible alternative to guardianship is fact dependent. Caregivers and potential guardians can consult with Law Office of Adriane S. Grace, PLLC to determine if a Supported Decision-Making agreement can be implemented to avoid a guardianship.
A guardianship can be created upon the application of any person. The court can appoint someone to be guardian over a disabled person and/or guardian over the disabled person’s estate. The court-appointed guardian of the person usually has the authority to make all healthcare decisions as well as decisions concerning the disabled person’s residence. Therefore, the role of guardian of the person is key for caregivers who need authority to place the disabled individual in a more supported living arrangement. The court-appointed guardian of the estate is responsible for managing the disabled person’s finances and property with the court’s supervision.
Probate courts have jurisdiction over guardianship proceedings and an individual applying to become someone else’s guardian must be represented by a lawyer who is certified to counsel and represent individuals in guardianship proceedings. Guardianship proceedings take time and are costly. In Texas, Applicants for guardian must swear that they considered alternatives prior to filing the guardianship, and determined they were not workable. Alternatives to guardianship can include signing a Supported Decision-Making Agreement, Durable Power of Attorney, and Medical Power of Attorney, and utilizing public benefits and community supports and services. Caregivers considering guardianship can consult with the Law Office of Adriane S. Grace, PLLC to determine if guardianship is the correct legal proceeding to file in their situation.
Individuals who qualify for certain public benefits such as Supplemental Security Income (SSI) and Medicaid must maintain their eligibility under the programs’ income and resource rules to continue to receive these benefits. These eligibility rules are complex. In sum, the individual’s access to excess funds must be very limited to maintain eligibility for their public benefits. An inheritance received through someone’s Will, or a Trust, could cause the individual to lose their benefits.
Social Security and Medicaid have rules that allow a person to save an inheritance while maintaining their eligibility for these programs. However, these rules are specific. Structuring the inheritance is key. One way to do this is to create Trusts or modify existing trusts so that it does not count as a resource to the individual under program rules. In Texas, a beneficiary under a Will or Trust can modify the terms of an existing Trust so that they can maintain their eligibility through the use of a Special Needs Trust (supplemental needs trust). Depending on the inherited trust terms, Trust Modifications could be done with an amendment to the Trust document. Otherwise, an inherited trust can be modified and converted to a Special Needs Trust through a court proceeding if all necessary parties are agreed. Law Office of Adriane S. Grace, PLLC assists clients with modifying Trusts, including testamentary Trusts in a probated Will, to qualify as a Special Needs Trust.
When a child’s parents die, or their last surviving parent dies, caregivers must immediately step in and assume not only the responsibilities of raising an orphaned child, but also collecting the child’s inheritance. No matter who the caregiver is, they will need the legal authority to carry out these responsibilities. A guardianship proceeding formalizes the caregivers’ role by giving them the legal right to make decisions concerning the orphaned children, just as a parent would. Guardianship also provides several methods for collecting a child’s inheritance and receiving distributions from the child’s inherited assets.
Guardianship is a different legal proceeding than a conservatorship. Guardianship provides a proceeding for a caregiver to obtain the authority to collect a child’s inherited assets whereas conservatorship does not. These rights are especially important for caregivers when a parent names their child as a direct beneficiary of life insurance policies, retirement benefits, and other financial accounts.
Probate courts have original jurisdiction over guardianship matters involving minor children as well as probate proceedings involving the deceased parent’s estate. Maintaining both proceedings in the probate court can better protect the minor children’s interest. Law Office of Adriane S. Grace, PLLC can assist with the filing of all proceedings necessary to administer the estate of the deceased parents while also obtaining the appropriate legal authority for an orphaned child’s caregivers.
Guardians and supporters of disabled individuals with special needs have the added challenge of determining the availability of supports and services for their loved ones. Many of these supports and services are provided through benefit programs administered by our federal and state governments. Navigating these programs can be a daunting task. Additionally, these programs have strict eligibility rules with long wait times. Some threshold eligibility rules require the disabled individual to meet a legal definition of disability, whereas other rules focus on the amount of income and resources available to the disabled individual.
The income and resource rules concerning eligibility for public benefits such as Supplemental Security Income (SSI) and Medicaid are particularly complex because they are the product of federal statute and administrative law. Guardians and supporters often find themselves in need of legal advice and counsel concerning how to assist family with eligibility for these programs, or creating a plan concerning excess income and resources that will allow their family member to maintain their eligibility for these programs.
Law Office of Adriane S. Grace, PLLC provides legal counseling and advising services to guardians and supporters of disabled individuals with special needs facing these issues. We assist guardians, supporters, and caregivers navigate complex federal statutes and regulatory rules and can help them develop a plan for eligibility under these rules.
This legal counseling and planning service is separate and apart from our Social Security appeals practice and is focused on clients who are guardians, supporters, or caregivers of disabled individuals with special needs.
Social Security
The Social Security Administration administers two types of federally funded disability programs under the Social Security Act: Disability Insurance (Title 2) and Supplemental Security Income (Title 16). The Title 2 program is limited to workers who have paid into the Social Security system by way of the Federal Insurance Contributions Act tax and who have earned enough “credits” to be insured for a disability claim. The Title 16 program is available to any disabled worker with limited income and resources. The income and resource limits are set by the Social Security Act, but generally, for Title 16 (SSI) eligibility, an unmarried individual person cannot have more than $2,000 in “countable” resources and no more than $1,767.00 per month in earned income for individuals (2022 values).
Some disabled workers may be dual eligible by way of both having earned enough Social Security “credits” under the Title 2 program and having limited income and resources under the Title 16 program. Nevertheless, the disability evaluation process is the same under both programs. Social Security uses a “five-step sequential evaluation process” at all levels of the agency adjudication and appeals proceedings to determine whether an applicant is “disabled” under the Social Security disability programs. Applicants for disability can be found disabled, or approved, at Step 3 or Step 5 of the sequential evaluation process as described below, but can be denied disability at Step 1, 2, 4, and 5 of the sequential evaluation process.
At Step 1 of the sequential evaluation process, Social Security must first make a determination of whether the applicant is engaged in “Substantial Gainful Activity” (SGA) or has been engaged in SGA since the applicant’s alleged onset date of disability. If they are, then the federal regulations direct a finding of “not disabled” for that period of time they are engaged in SGA, regardless of the applicant’s medical condition, diagnosis, or prognosis.
What constitutes SGA depends on whether the applicant is self-employed, or is employed by someone else, as in the case of a person who receives a W-2 from their employer at the end of the year. The SGA rules for self-employed individuals are complex as there are three different “tests” the agency uses for determining whether a self-employed individual is engaged in SGA, with one test in particular looking not at actual earnings, but at the amount of time the individual expended at the job. For W-2 employees, Social Security has published the SGA amount for each year of potential earnings from 1975 to the present year, and the amount increases annually according to changes in the national average wage index. For 2022, earnings of at least $1,350 per month are considered “SGA” for non-blind individuals. For example, if an applicant applied in 2022 for Social Security disability, but had monthly earnings of $1,350 or more, then the federal regulations direct a finding of “not disabled”.
To make this Step 1 determination, Social Security refers to its own internal reports that it generates from IRS tax records it receives on a quarterly basis, including “new hire” reports, as well as the admissions of the Applicant. All applicants for disability are required to report their work history for the 15 years prior to the onset of their disability in their application and at multiple stages throughout the adjudication process. They are also asked upon initial application, to swear, under penalty of perjury, whether they have reviewed their earnings record with Social Security and whether it is accurate. Because the source of the Social Security Administration’s earnings record for every worker are the IRS tax records, any payments that a worker does not report to the IRS will also not be contained in Social Security’s earnings records. This is especially the case with “under the table” payments to workers and employees; workers who fail to file tax returns; or workers who falsify their earnings on their tax records to minimize their tax liability. Unfortunately, a direct consequence of this behavior is reduced Social Security benefits as the benefit amount is directly tied to a worker’s tax payment history, or worse, ineligibility for the disability program due to a lack of earned “credits”.
At Step 2 of the sequential evaluation process, Social Security must determine whether the applicant has a “medically determinable impairment” that is “severe”. This is defined as a physical or mental condition that causes more than a minimal limitation on the individual’s ability to function and that has lasted, or is expected to last more than 12 months. To make this determination, Social Security obtains the medical records of the applicant and compares the medical evidence in those records to the allegations made by the applicant concerning their disability.
Upon application, the actual determination at Step 2 is made by physicians employed by the agency and Social Security will make a determination that an applicant has a medically determinable impairment based only upon medical reports received from “acceptable medical sources”. Those acceptable medical sources include licensed physicians, licensed psychologists, licensed optometrists, licensed podiatrists, licensed advanced practice registered nurses, and licensed physician’s assistants. In sum, a medical expert makes the Step 2 determination based on the reports of other medical experts. At the hearing level of the appeals process (discussed in detail below), the Administrative Law Judge often adopts these findings by the agency physicians at the application level, or obtains the opinion of a disinterested medical expert testifying at the hearing. If the applicant is determined to have at least one severe medically determinable impairment, the disability evaluation proceeds to Step 3 of the process. Otherwise, the applicant is denied at Step 2 if there is no medical evidence from an acceptable medical source of a “severe medically determinable impairment”.
At Step 3 of the sequential evaluation process, Social Security determines whether the applicant’s severe medically determinable impairment(s) “meets or equals” one of their “listing of impairments” for adults. These listings, and their severity level criteria, for purposes of establishing a “disabling” severe medically determinable impairment, are published in the federal regulations and change from time to time. For example, the listing of impairments for a musculoskeletal condition such as spine and joint conditions, underwent significant changes in 2021, making it increasingly more difficult for an applicant to “meet” a listing for a back or joint impairment if they had no medically documented need for a wheelchair or handheld assistive device such as a cane or walker.
The determination of whether an applicant meets or equals a listing is again made by a physician employed by the agency at the application level, or a medical expert testifying at a hearing. If the medical expert determines that the individual’s impairment does not meet or equal a listing, then the agency must next determine the applicant’s “residual functional capacity” (RFC). Informally, the agency refers to this as “Step 3 ½” as it is a necessary precursor to the vocational disability determinations made at Step 4 and 5 of the sequential evaluation process.
The RFC is an assessment of the applicant’s maximum capacity for the various physical and mental demands of any job given the individual’s underlying medical condition or “severe medically determinable impairment”. For example, an RFC is generally expressed as the maximum amount of time, in an 8-hour work day, that the individual can do certain physical activities such as sit, stand, walk, push, pull, climb, reach in all directions, etc., and/or whether they can respond to the normal social pressures and demands of employers, co-workers, and customers, and/or whether they have the skills for certain types of jobs (unskilled verses semi-skilled vs skilled jobs). These assessments are generally also made by medical experts but can also be made by certain adjudicators such as Administrative Law Judges.
However, the adjudicator or ALJ’s RFC assessment must be based on evidence in the medical record from acceptable medical sources. The applicant’s own subjective complaints or testimony concerning the severity of their condition and symptoms are insufficient for an RFC finding. In fact, although a claimant for disability is permitted to freely testify at a hearing about their perceptions of the severity of their own condition and their symptoms, the ALJ is not required to take these statements at face value, and is required, by law, to assess the claimant’s credibility as to the statements they make. This credibility assessment is made by comparing the claimant’s statements to the objective medical evidence contained in the record.
At Step 4 of the sequential evaluation process, the agency determines the applicant’s “Past Relevant Work” (PRW) and whether, given their RFC, the applicant can perform this work as they performed it, or as that job is normally performed in the national economy. The agency uses vocational experts (VEs) to make this determination. At the application level, vocational experts are employed by the agency to review the applicant’s work history and assess the type of job they worked and the physical and mental demands of that job using the Dictionary of Occupational Titles (an ancient publication by the U.S. Department of Labor Employment and Training Administration) as well as their own education and experience. Vocational experts are required to have a master’s level education and most have extensive past experience with social welfare programs aimed at rehabilitating and placing disabled workers in the job market.
At the hearing, ALJs use disinterested vocational experts to testify and assess the applicant’s work history based on a review of the evidence in the record and listening to the testimony of the applicant about how they performed their job, how long they worked at their job, how much they earned, and their educational level. The vocational expert also opines on whether, based on a hypothetical RFC posited by the ALJ and the expert’s assessment of any PRW, the applicant can perform the demands of their PRW. If the VE testifies or opines that the applicant can perform PRW, then the regulations direct a finding of “not disabled”.
For example, if the applicant has an RFC for unskilled, “light” duty work (standing and walking maximum 6 hours out of an 8-hour day and sitting at least 2 hours), but has PRW of unskilled sedentary work (sit/stand no more than 2 hours and sitting at least 6 hours of an 8-hour work day), then they are not disabled because the RFC does not preclude, or prevent them from returning to their PRW. If, however, the opposite was true—RFC of sedentary and light PRW—then the analysis would proceed to the final, fifth step of the sequential evaluation process because such an RFC would preclude PRW.
At Step 5 of the sequential evaluation process, and after the applicant has been found unable to perform their PRW, the agency must still determine whether the applicant can perform any other jobs in the national economy given their age, education, PRW, and RFC. At this step, the decision can be very fact dependent, especially depending upon the age of the applicant as the agency uses “grid rules” for efficiency in administrative decisionmaking. These “grid rules” become mostly relevant when a disability applicant reaches the age of 50 because the adjudicator can plug in facts like the person’s age, education, PRW, RFC, and transferability of any job skills, and the grid rules produce a decision of “disabled” or “not disabled”. For example, a person who reaches step 5 and is age 50, has a high school education, has no transferable skills to other work, has PRW that is unskilled, and has an RFC of “sedentary” work will be found “disabled” under Rule 202.12.
For individuals under 50, the determination of disability often requires the testimony of a vocational expert. In such cases, the vocational expert opines on whether there are any other jobs in the national economy in significant numbers that the applicant could work given their RFC. And this opinion is not based on actual jobs available in the job market, but instead on estimates provided by the DOT for every job category. In sum, the decisions made at this step of the process are based on multiple opinions of other experts who have analyzed the evidence in the record.
Additionally, it is at this step where the agency specifies the onset date of the person’s disability, if there is a finding of disability. For example, an applicant may allege a specific disability onset date, but the agency can find that based on the medical evidence, a decision of disability is not merited until a later date, and thereby set a later disability onset date, resulting in less past due benefits. Alternatively, the agency can also determine disability for a “closed period”. A closed period decision usually includes a favorable decision for one part of the applicant’s alleged disability period, and an unfavorable decision for the remainder of the alleged disability period. This can be the case where the agency determines either (1) the applicant was engaged in SGA at some point during the alleged disability period, rendering them ineligible for disability during that period of time, or (2) where the agency finds the individual was disabled for part of the alleged disability period, but the medical evidence showed an improvement such that the person was no longer considered disabled as of a certain date during the alleged disability period.