Blogs from September, 2019

Probate, estate, and property law are very state-specific. While all American probate, estate, and property law is deeply rooted in old, feudal, English law, there are idiosyncrasies from state-to-state that could have a big impact on your estate planning. This begs the question, what type of estate plan is best for a person or family who anticipates moving?

Almost any estate planning document you write must be created under the laws in which you are domiciled at the time you create it. A will eventually has to go to a probate court to be proved as valid in front of a judge, so a will is generally written with a specific state’s probate court requirements in mind. A will written in a different state could very well be valid in a state other than the one in which it was written. However, it might not have all the requirements required in the new state’s probate court, and not having all the state’s requirements could lengthen the probate process. And a lengthy probate process could be an expensive probate process . . .

A trust, however, is more like a contract than a property transfer, believe it or not. A revocable living trust is created to give instructions on what should happen to your stuff after you die—just like a will—but a well-written trust is also created to avoid having to go to court. If you transfer all of your titled assets into a trust while you’re still alive, then a court doesn’t have to be involved in the transfer of property. If you don’t have to go to court, then you don’t have to worry about that state’s probate laws!

If you’ve recently moved to Texas and aren’t sure if your current will or trust should be updated, make an appointment with one of our attorneys so that we can review it and advise you on what updates, if any, should be made. 

First and foremost, congratulations! If someone named you as a trustee or successor trustee, that person must have thought that you are smart, trustworthy, and organized. Being chosen as a trustee is a pretty big compliment.

But, just like Uncle Ben told Spiderman: “With great power comes great responsibility.” (I think Voltaire said it first, but that’s neither here nor there.)

Your first step as a trustee is to get your hands on the trust. The trust will give specific instructions on what your powers are, what limitations you have, and who the beneficiaries are. A well-written trust is a set of rules for what is given to whom and how. 

A lot of trusts, but not all, will instruct you to liquidate and combine all assets of the person who made the trust (the “Settlor”).  The super important part here is that you should keep everything in a separate bank account for the trust and absolutely do not mix trust monies in with your own personal bank accounts, even if you have a separate ledger for it. The trust assets need their own account. Sometimes, you might have to create multiple trust accounts if, for example, you have to retain part of the trust money for someone who is a minor.

If a beneficiary of the trust is over 18 years old, but the trust says that he or she cannot have the money until a later age, you have to be able to give an accounting of the trust assets within a reasonable time after that person asks for it. You might also have to give an accounting to the Settlor if you’re acting as trustee because the Settlor is incapacitated.

If you get a little (or a lot) overwhelmed by any of this, most trusts not only allow but will pay for you to get some professional help from a lawyer, accountant, or investment advisor. If you’ve been named as a trustee or successor trustee and you’re feeling a little overwhelmed right now, give us a call or set up an online appointment.