What will happen to your property – your house, your investments, and your belongings – after you die? Will it go to the people and causes you care about, or will it be distributed by the government?

Estate planning is one of the most difficult, yet one of the most important tasks that you will face in your lifetime. By carefully drafting and maintaining the proper documents, you can decide exactly what happens to your property in the event of your death.

If you do not have first-hand experience with estate law, or even if you do, attempting to handle these complex issues for your own family can cause unnecessary stress and heartache. A qualified Austin estate planning lawyer can help you avoid the possibility of having the estate tied up in court for months or years, or even having to pay fees and taxes that could possibly be avoided with the help of a guiding hand.

Most legal matters include:

Probate Litigation
Estate Planning
Trusts
Wills
Living Wills
Contested Wills
Heirships
Small Estates

Probate lawyer in Austin:
The Butler Firm, PLLC, is a native Texas law office, a boutique law firm with two offices in Austin and Round Rock. Our small group of dedicated probate lawyers and attorneys help those who have lost a loved one navigate the Texas probate system with ease and minimal financial strain. Additionally, our Austin and Round Rock probate lawyers assist their clients by drafting Wills and providing estate planning assistance.

Guardianships can be broken down into Minor and Incompetent Guardianships. Either situation, deemed necessary by a court appointed expert or doctor, can require a Guardian in order to protect a loved one both physically and financially. A Guardian is appointed to assume the responsibilities to provide care to a deemed ward or the estate of a deemed adult incapable of caring for himself or herself. Generally the process begins with an application for the Guardianship through the proper court. Guardianship applications can be completed by a Probate Lawyer in Austin TX, or other attorney familiar with a specific court jurisdiction. If necessary, the matter can be deemed an emergency, thereby deciding the matter within a 24 hour period in most cases. Otherwise the procedure follows the court determined process of determining the proper person so serve as the Guardian. The prospective ward is evaluated by properly qualified or court appointed professional to determine the ward’s incapability of caring either physically and/or financially for themselves.

Guardians can also be appointed of either the Person, providing only food, clothing and shelter and caring for the physical needs of the ward and/or appointed as Guardian of the Estate. Guardians of an Estate would ensure the financial interests of the ward were recognized. Probate Attorneys have experience in maintaining the required documents for accounting purposes and submitting annually documents indicating the activity of Estate of the ward.

The Court alone can approve financial expenditures on behalf of a ward upon the request of the Guardian, in writing and following proper procedure. The Court also does not allow Guardians to benefit from their services to the ward. Guardianship matters are reviewed on a regular basis and can be terminated upon professional and Court approval.

The biggest difference between an independent or dependent administrator is the fact that a dependent administrator must receive the approval of the court for almost all of the actions they perform. The must receive approval for:

Payment of fees relating to professional services required for the probate of the will including accountants and attorneys

• The sale of any real estate
• The sale of any personal property
• The sale of assets such as cars
• The repayment of debts owed by the deceased
• The payment of expenses due the administrator during the course of the probate period.

A dependent administrator must petition the court, in writing, to receive approval to perform any of these tasks.

Many people like the fact that dependent administrators must be bonded. A bond is basically insurance that the administrator will perform their duties honestly and ethically. They must pay a bonding company to provide the insurance for them. This is especially useful in cases where the estate is particularly large or involves a large amount of assets.

Another benefit of the dependent administration is protection in the case of estates that involve heirs that are likely to argue or fight over assets and debts. Because the court approves each step of the process, a dependent administrator can typically avoid future legal action against the estate.

In cases where there is a large amount of debt, the dependent administrator has a very specific set of guidelines governing how debts are repaid. Creditors must carefully apply for repayment of the monies owed to them. They must fill out specific forms; provide information and file within a specific time frame.

While a dependent administration must be requested within the allotted four year time period, there is an additional time constraint placed on them. Even if the estate is settled, the estate must be remain open. In many cases it makes the process longer than an independent process would be.

Dependent administrators are also bound by accounting requirements. They must submit, on a yearly basis, a complete accounting of the estate. This includes information on monies earned by the estate through interest or the sale of assets as well as any expenses paid, either to the administrator or professional fees such as accountants, attorney or legal fees. This accounting must also be completed at the end of the probate. Information must also be provided regarding outstanding debts and assets.

At the end of the day, dependent administration tends to offer the estate a higher degree of protection as opposed to an independent administration. Unfortunately it can also be a much longer process. Consult a probate attorney to determine which will work best for your particular case.

When selecting an executor, you must carefully consider your options. You want to choose someone who is qualified to deal with the complexities of your will and estate. You will want someone you trust. The person you should select should be ethical, responsible, mature and trustworthy. Some good suggestions for qualified executors include accountants, trust officers and lawyers. Typically you will appoint only one executor. In some rare cases two are appointed with the understanding that the second will take over the duties if the first executor for some reason cannot complete their job. It is possible that your choice of executor will be overturned if the court feels the person cannot adequately perform their duties or if they are a convicted felon.

After your death, your executor will perform several vital functions on your behalf. These include:

• Filing your will with the state probate court as appropriate
• Petitioning the court for letters stating that they have been appointed, legally, as the executor of the estate
• Request and receive official death certificate copies for use during the probate period
• Completing a full and honest accounting and inventory of the assets of the estate. This will include bank accounts, car titles, deeds, stock information, brokerage accounts and other assets
• Completing the process of re-titling, if required
• Protect and manage the assets of your estate
• Repay any debts that are outstanding at the time of death
• File insurance claim benefits on behalf of beneficiary or heirs
• Account for any monies owed to the estate
• Hire lawyers, accountants or other professionals if warranted
• Keep a complete accounting of all actions performed on behalf of the estate
• Complete and file outstanding income taxes
• Complete the probate process and close out the estate upon completion of duties

In certain cases, it may be necessary to remove an appointed executor. Heirs or beneficiaries may request the executor be removed if the executor has failed in their duties or if they have an interest in the estate themselves.

It is true that executors are allowed compensation for their services. These services are typically determined by a fee schedule provided by the state.

If you are considering appointing a trustee to handle your estate after your death, be sure to consider the matter carefully. It is a good idea to discuss the matter with your attorney. They can advise you on your decision and ensure the proper paperwork is completed to ensure your wishes are carried out.

In some cases, it may not be necessary to send a will through the probate process. While probate is the legal method of processing a will and its estate, it is not always the most efficient method of handling an estate. Understanding the alternatives to probate begins with understand just what probate is.

As a general rule, the probate process will perform several key functions on behalf of an estate and its heirs. These include:

• Providing proof to the court that the will provided is valid and belongs to the deceased and their estate
• Completing an accurate inventory of the assets owned by the deceased at the time of their death
• Engaging professionals to accurately appraise the value of real estate and other assets
• Repay any outstanding debts or taxes owed by the deceased or the estate
• Properly distributing the remaining assets of the estates to the legal beneficiary or heirs according to the terms of the will

In order to avoid probate, one of several options, or a combination, must be chosen and completed.

• Payable on Death: Also known as Transfer on Death Accounts, Payable on Death simply allows the deceased to set up, prior to death, a direct transfer of items such as investment or bank accounts directly to their chosen heir upon their death. These assets will not be subjected to the probate process. Other examples include 401K accounts, IRA’s and sometimes brokerage accounts.
• Joint Accounts: By setting up bank and investment accounts as ‘joint’ and ensuring that they have the designation “with right of survivorship,” the account automatically transfers to the survivor upon death of the other account holder. This process is simple and only requires a certified death certificate be shown to the bank or financial institution
• Joint Property: Much like joint accounts, by co-owning property, it is often possible to avoid probate. The determining factor is how the property in question is title. It is critical the property be designated as ”Owning Joint Property with Right of Survivorship.”
• Revocable Living Trust: A revocable living trust is a writing agreement that forms a trust that is then funded by the assets of the estate. The deceased, upon setting up the trust, becomes the ‘trust maker.” They can deposit assets into the trust as well as invest it. Upon their death, the trust passes to their heirs as a ‘living’ trust. The new trustee will have access to the trust and be able to use it as they see fit within the confines of the trust itself.
• Gifting: Assets or property that are ‘gifted’ prior to death do not need to be probated.
• Small Estates: Estates with a monetary value of less that $100,000 can typically be handled without the probate process

Each of these alternatives works in specific cases. Consult a qualified probate attorney to determine which is ideal for your particular estate and needs.

Executors can be appointed independent in two different ways.

• The deceased provided a will which states, specifically, that the executor appointed will work as an independent executor
• If the deceased did not have a will but the beneficiaries or heirs agree unanimously that the appointed executor should work as an independent administrator.

Using an independent administrator during the probate process is beneficial in several ways. Most importantly, the administrator does not have to apply to the court for approval of all of the actions he performs on behalf of the estate. An independent administrator is not required to post a bond, while a dependent administrator is. Finally, there are often additional attorney and court fees associated with a dependent administrator that may be avoided by working with an independent one.

In effect, an independent administrator will perform the same basic functions of any probate executor. They will collect the assets of the estate, liquidate them as needed to pay off remaining debt and divide the remaining assets among the heirs. If the deceased left no will, the independent executor will take several additional steps. This includes posting a public notice for potential creditors and completing an inventory for the court system.

As a rule, you have four years from the time of death to probate a will or request an executor be appointed. In very rare cases the court can make exceptions to this rule. It is advisable to request a probate as soon as possible after a death occurs whether or not the deceased left a will.

There are a few cases in which it is not advisable to request an independent administrator. Remember that the rules that govern how an executor repays creditors are different for dependent and independent administrators. If there are exceptionally large amounts of debts, it may be better to work with a dependent administrator.

While many courts prefer that executor be independent administrators, in some cases an executor may choose to be appointed dependent. This is especially true if the heirs are likely to fight or make matters more difficult. Because the dependent administrator must receive court approval for each action, they find there is built in protection against future arguments.

Determining which type of executor will work best for your particular situation is a personal choice. It is often advisable to work closely with a qualified probate attorney to ensure that the probate process goes as smoothly as possible. An independent administrator may be the ideal solution for your will.

This type of probate is appropriate in cases where the deceased has left a Last Will and Testament and when there are not any debts that are unsecured by real estate. This type of probate cannot be used in cases where there must be an administrator who can settle the estate by gathering a list of assets, liquidating them as needed, paying off debts and creditors and finally distributing the remainder of the estate to the heirs or beneficiaries.

This is an ideal form of probate for one main reason: it is the shortest way to probate the will. Unfortunately, if there are investments such as corporate securities, where out of state companies or agents must be involved, they often do not understand the unique form of probate that is Muniment of title. In cases where it is obvious that out of state entities must be involved it is not recommended that this form of probate be used.

The process involved in Muniment of Title is quite simple. First an Application must be filled out. This application will be ‘sworn to by the requestor. A filling fee and the original will must be included with the application. The courthouse must receive notice of the application 10 days before the Monday during the week the hearing will be heard. In certain cases, heirs must be informed as well. The hearing will include several key aspects. These include:

• Proof that the death occurred as stated and information on the cause
• A witness must officially ‘sign’ attesting to the information above. This is referred to as “Proof of Death and Other Facts”
• The will must be proved. If it is not self-proving, witnesses will be required to prove it
• The judge will order the will into probate under Muniment of Title.

At this point, the order will be filed as needed. Typically this includes each county or area in which the estate owned real estate. While an inventory is not required under Muniment of Title, it is commonly requested by the judge. Additionally, it may be necessary to submit a written statement that any property has been legally transferred to the appropriate beneficiary or heir.

To start the process the original will, original death certificate and the applicable filing fees are needed. To determine if the Muniment of Title is the appropriate form of probate for your particular situation, it is important you meet with a qualified attorney. They can advise you as to the form of probate needed and assist you with the sometimes difficult and painful process of probate.

Income Tax Return on Behalf of the Deceased:

The executor must file a tax return on behalf of the deceased for the final year of their life. This tax return is much like the tax return filed during life. It covers the same time period (January 1 – December 31). If the deceased was married, the executor will work with the remaining spouse to file the tax returns. For example, if the couple typically filed jointly, the executor and the remaining spouse will file together. If the deceased received a tax return, the money will become a part of the estate and will become a part of the tax return filed on behalf of the estate.

Income Tax Return on Behalf of the Estate Income:

In many cases, a deceased estate will generate some form of income. This could come from interest, stocks, bonds, a final paycheck or even a tax return filed on the behalf of the deceased after their death. All of this income must be properly reported by the estate. This involves filling a separate tax return. They laws governing this tax return can be complex and cumbersome and many executors choose to work directly with a tax preparer to ensure that they are properly filing the returns. It is important to remember that taxes on an estate are almost always higher than individual tax rates. There are several ways to handle an estate’s income and how it is taxed, including distributing the income to legal beneficiaries or heirs so that they pay the tax instead. A tax professional can assist with these determinations.

The Tax Return on Behalf of the Estate:

Not to be confused with the Estate Income Tax Return, the Estate Tax return deals specifically with taxes on the assets owned at the time of death. Some of these assets may be exempt, but those that are not are typically taxed at a very high rate. The executor must work closely with a tax professional to ensure that this return is prepared in full and includes an accurate and honest representation of the assets of the estate.

The rules governing tax returns for the deceased and their estates are complex and cumbersome. Working closely with a probate attorney and a qualified tax professional is the best way to ensure that the taxes that are paid on estate are indeed owed and that the entire estate is represented by the applicable returns.

In order to remaining on the up and up with the IRS, and to ensure that the estate will not be taxed a second time when the remaining spouse passes, there are a number of rules that must be followed.

1. The remaining spouse must have limited access to the trust for the remainder of his life. In short, the remaining spouse does not have unlimited access to the principal of the trust. He or she cannot withdraw as much as he or she wants whenever they want. Instead, the bypass trust is designed to provide funds for health, maintenance, education and support as well as the ability to withdraw $5,000 or 5% of the principle, whichever is greater, each year. Please note that because the remaining spouse can be named as trustee of the bypass trust, this law is actually somewhat flexible.

2. The remaining spouse has a limited ability to distribute the assets of the trust at the time of their death. The remaining spouse cannot simply leave the remaining assets of the trust to his own estate, his own creditors or his estates creditors. The bypass trust can be set-up to permit the remaining spouse to designate a person, or people, to succeed the trust upon their demise. For example, the bypass trust may state that the remaining spouse may divide the remaining assets among their children. Another option is to designate the final heir in the bypass document itself, leaving the remaining spouse no discretion in the matter.

If you are considering forming a bypass trust, it is critical that you work closely with a trust attorney. The language set forth by the IRS is very specific. Any deviation, no matter how slight, may result in a revocation of the rights granted by the bypass trust. In other words, if the bypass trust is not properly worded, the benefit, that the trust will not be taxable after the second spouse passes, will be revoked.

A bypass trust can be an excellent financial tool for estate planning purposes. It gives couples the ability to control their estate, even after they pass. It also prevents them from saddling future heirs with what can be very costly estate taxes. Proper planning of your estate may very well include a bypass trust. Consult your attorney to determine if this is the best tool for you, your spouse and your joint estate.