The Trusted Name in Elder Law and Estate Planning Since 1984
Frequently Asked Questions
About Elder Law and Estate Planning
Elder Law and Estate Planning can often seem complicated and confusing. To add some clarity to the process, we have compiled a list of Frequently Asked Questions in the space below. If you have further inquiries, please to contact our office, and we will happily answer your questions.
Advance Directives are legal documents, prepared in advance of need, used to direct financial and medical affairs. Appointing an Agent under a Durable Financial Power of Attorney designates a person to act on your behalf in legal and financial matters. Appointing an Agent under a Power of Attorney for Healthcare identifies the person you select to make medical decisions if you are incapacitated. A Living Will (Directive to Physicians) is a document which specifies the types of medical care you would or would not want if you were terminally ill and incapacitated, providing useful guidance to your loved ones and medical team.
Sometimes called a Directive to Physicians, a living will allows you to state your wishes in advance regarding what types of medical life support measures you prefer to have, or have withheld/withdrawn if you are in a terminal condition (without reasonable hope of recovery) and cannot express your wishes yourself. Oftentimes a Living Will is executed along with a Durable Power of Attorney for Health Care, which gives your Agent legal authority to make your health care decisions when you are unable to do so yourself.
A Durable Financial Power of Attorney allows you to appoint someone you know and trust to make your financial decisions even when you cannot. If you are incapacitated without these legal documents in place, then you and your family may have to undure a costly and time consuming probate proceeding known as a guardianship. This is the court proceeding where a judge determines who should make these decisions for you under the ongoing supervision of the court.
Both General and Durable Powers of Attorney give your Agent the right to pay bills, sign documents or conduct financial transactions on your behalf. The authority of the Agent acting under a General POA ends if the principal becomes incapacitated, but an Agent acting under a Durable POA can act even if the principal has become incapacitated. Both documents go into effect immediately upon being signed, and both can be revoked.
A Power of Attorney is a document which names a substitute decision maker for financial or medical matters. As long as the person who appointed the Agent (the Principal) under the Power of Attorney has not been judged incapacitated, the Power of Attorney designations can be revoked or changed at any time. Agents should be chosen based on their ability to act according to the Principal’s wishes.
A Power of Attorney for Healthcare is a legal document which names an Agent who can act if an individual is incapable of making a medical decision. The ability to make medical decisions is determined by a physician, and the threshold for capacity differs depending on the complexity of the decision. The Agent under a Power of Attorney for Healthcare only has authority to make decisions during the period of incapacity. Common causes of incapacity include loss of consciousness, delirium, severe psychosis, and advanced dementia.
When choosing an agent under a Power of Attorney for Healthcare, consider the following:
- Choose someone who will talk with you now about your wishes, and who will do as you ask when the time comes.
- Choose someone who lives near you, or who could travel to be with you, if needed.
- Choose someone you trust with your life.
- Choose someone who can handle conflicting opinions from family, friends, and medical personnel.
- Choose someone who can be a strong advocate for you if a doctor or facility is unresponsive.
In order for someone to be judged incapacitated, evidence of poor decision making would need to be brought before a judge who specializes in determining capacity. If the judge rules that an individual is incapacitated, a guardian would be appointed. Sometimes two guardians are appointed: one to make financial decisions and the other to make health and personal decisions. Often, less-restrictive alternatives to guardianship can be arranged with proper legal assistance.
DNR stands for Do Not Resuscitate. Medical personal are required by law to provide resuscitation in the State of Texas unless a person has signed an Out of Hospital DNR Form. Resuscitation is traumatic to the body, and for an older person with osteoporosis or other health complications, the odds of surviving are very poor. Some people choose not to endure these procedures. Long-term care communities such as assisted living or memory care communities keep record of their residents who have completed an Out of Hospital DNR, so that their wishes are followed. This form must be signed by a physician, and is not completed by an attorney. The Texas Out of Hospital DNR form can be found here. https://www.dshs.state.tx.us/emstraumasystems/dnr/shtm
Yes. An attorney accredited with the VA can help determine if you qualify for this pension available to some war-time veterans, or their surviving spouses, whose monthly healthcare costs exceed their monthly income. If you are having to draw from your savings to pay for assisted living or other health care costs, you may qualify for this benefit.
Often companies or individuals advertising for Free Medicaid Qualification are actually selling annuities or other financial products. So while you may not pay any up-front fees, you will pay ongoing commission and other fees. Also these individuals are not fiduciaries, meaning, they don’t have to recommend the financial products that are in your best interest.
This is the most common form of asset ownership between spouses. Joint tenancy (or TBE) has the advantage of avoiding probate at the death of the first spouse. However, the surviving spouse should not add the names of other relatives to their assets. Doing so may subject their assets to loss through the debts, bankruptcies, divorces and/or lawsuits of any additional joint tenants. Joint tenancy planning also may result in unnecessary death taxes on the estate of a married couple.
Many people choose to add a family member to their bank account for convenience, but joint accounts have potential pitfalls, including disinheriting heirs. A good alternative is to appoint a trusted family member to act on your behalf through a Durable Power of Attorney. Another option is to give your family member signature authority instead of joint ownership. The best option may be to create a Trust to ensure that funds are disbursed according to your wishes.
You may avoid probate on the transfer of some assets at your death through the use of beneficiary designations. Laws regarding what assets may be transferred without probate (non-probate transfer laws) vary from state to state. Some common examples include life insurance death benefits and bank accounts.
This is an agreement with three parties: the Trust-makers, the Trustees (or Trust Managers), and the Trust Beneficiaries. For example, spouses may name themselves all three parties to create their trust, manage all the assets transferred to the trust, and have full use and enjoyment of all the trust assets as beneficiaries. Further “back-up” managers can step in under the terms of the trust to manage the assets should the couple become incapacitated or die. Special provisions in the trust also control the management and distribution of assets to heirs in the event of the trustmaker’s death. With proper planning, the couple also can avoid or eliminate death taxes on their estate. The Revocable Living Trust may allow them to accomplish all this outside of any court proceeding.
Whether you are young or old, rich or poor, married or single, if you own titled assets such as a house and want your loved ones to avoid court interference at your death or incapacity, consider a revocable living trust. A trust allows you to bring all of your assets together under one plan.
A Will is the document a person signs to provide for the orderly disposition of assets after death. Wills do not avoid probate. Wills have no legal authority until the willmaker dies and the original will is delivered to the Probate Court. Still, everyone with minor children needs a will. It is the only way to appoint the new “parent” of an orphaned child. Special testamentary trust provisions in a will can provide for the management and distribution of assets for your heirs. Additionally, assets can be arranged and coordinated with provisions of the testamentary trusts to avoid death taxes.
If you die without a Will (intestate), the Texas Legislature has determined who will inherit your assets and when they will inherit them. You may not agree with their plan, but roughly 70 percent of Americans currently use it.
It’s a good rule of thumb to review your documents at least every three years, but changes don’t need to be made unless family circumstances have changed. Many people think of changing their documents after a marriage, divorce, or death, but those are not the only reasons you may want to make a change. Perhaps your appointed agent under a Power of Attorney is going through a physical or mental health crisis or the person you appointed executor of your will has made some poor decisions lately. Documents should be updated to ensure your wishes are followed.
Probate is the court and process that looks after people who cannot make their own personal, health care and financial decisions. These people fall into three general categories: Minor Children (under age 18 in most states); Incapacitated Adults; and People who have died without legal arrangements to avoid probate. Probate proceedings can be expensive and time-consuming. Additionally, the court proceeding and associated documents are all a matter of public record. Many people choose to avoid probate in order to save money, spare their heirs a legal hassle, and keep their personal affairs private.