Friday, July 3, 2015

Texas Increases Allowances for Surviving Spouse and Children

Hooray for modern times! As part of the new Texas Estates Code, the Texas Legislature finally got around to increasing various exemptions and allowances for surviving family members.

Section 102.004 of the Texas Estates Code clarifies that the homestead of a decedent who is survived by a spouse or a minor child is not liable for the payment of any debts of the deceased’s estate, other than certain debts which may be secured by that homestead under the Texas Constitution – essentially, purchase money or home equity liens, ad valorem property taxes, certain materialmen’s liens, an owelty of partition, or a reverse mortgage.

Effective January 1, 2014, Chapter 353 of the Texas Estates Code sets new amounts for certain allowances that may be claimed by a surviving spouse or certain children of the deceased, prior to payment of any creditor’s claims.

Under Section 353.053, in place of a homestead under Section 102.004 (for persons who lease or otherwise do not have a suitable homestead), qualified survivors can request that the probate court set aside an allowance up to $45,000 – previously, the maximum allowance in place of the homestead was $15,000. 

In lieu of any exempt personal property, the survivors can also request the probate court set aside an allowance up to $30,000 – the previous cap on this allowance was $5,000. 

These two allowances are in addition to the “family allowance” that may be requested under Section 353.102 of the Texas Estates Code for the maintenance of the surviving spouse, minor children, and any adult incapacitated children for one year from the date of the decedent’s death. 

Effectively, the Texas Legislature now permits qualified survivors to set aside up to $75,000 (versus the previous $20,000), as well as a “family allowance” when necessary, to help provide for their care without the fear of such funds being seized by the deceased’s creditors. 

By: Cynthia W. Veidt,

Monday, June 29, 2015

Impact of SCOTUS Ruling on Same-Sex Marriage in Texas Estate Planning and Disability Planning

On June 26, 2015, the Supreme Court of the United States (SCOTUS) in Obergefell v. Hodges ruled that all 50 states and the District of Columbia must issue marriage licenses and recognize marriages regardless of whether the spouses are both male or female.  In effect, this ruling guarantees equal protection under the law to same-sex couples concerning not only marriage, but the property rights and other legal presumptions arising from marriage.

As the majority of the Court’s justices have stated:

“No union is more profound than marriage, for it embodies the highest ideals of love, fidelity, devotion, sacrifice, and family. In forming a marital union, two people become something greater than once they were. As some of the petitioners in these cases demonstrate, marriage embodies a love that may endure even past death. It would misunderstand these men and women to say they disrespect the idea of marriage. Their plea is that they do respect it, respect it so deeply that they seek to find its fulfillment for themselves. Their hope is not to be condemned to live in loneliness, excluded from one of civilization’s oldest institutions.  They ask for equal dignity in the eyes of the law. The Constitution grants them that right.” – Justice Anthony Kennedy. (Please click on the name of the case above if you wish to read the entire opinion.)

LPV is ready to assist all couples in understanding their legal rights and obligations concerning estate planning – the method by which one passes one’s property to others upon death, through probate or non-probate means, as well as disability planning – the method by which one communicates one’s desires and instructions for addressing short-term or long-term inability to make legal or financial decisions for oneself. 

For example, you can choose to sign a written document designating who will make medical decisions for you and who can visit you in a hospital (Medical Power of Attorney); now, even if you have not done so, your spouse in a same-sex marriage will have statutory rights to do so.  You can also, by signing a Last Will and Testament or beneficiary designation, choose who will receive your property upon your death; now, your spouse in a same-sex marriage will have inheritance rights under state law.  Only spouses can “roll over” an IRA from the deceased spouse to their own IRA; now, your spouse in a same sex marriage can do so and avoid situations where required minimum distributions must start immediately, even if the surviving spouse has not reached 70 ½ years of age.

However, the universal recognition of same-sex marriage in Texas by various administrators and officials will likely be a rocky road, despite SCOTUS’ historic and unequivocal opinion.  Couples should review their estate planning and disability planning needs with an attorney so that they can take advantage of a variety of methods suited to their particular circumstances.

Attorneys and staff at LPV look forward to serving the needs of all married couples.

By: Cindy Veidt, 6/29/2015

Friday, June 12, 2015

Changes to the Texas Statutory Durable Power of Attorney Form

Effective January 1, 2014, Texas has adopted a new pre-approved form for its Statutory Durable Power of Attorney, a/k/a the power of attorney for your financial affairs. All forms must substantially comply with the new statute in order to remain effective.

Substantial compliance is always a tricky task. In order to avoid challenges that may be determined in a judge’s discretion, Texas residents should consider preparing a new statutory durable power of attorney that closely follows the specific statutory form now contained in Section 752.051 of the Texas Estates Code. We also recommend updating your estate and health care planning documents – including powers of attorney forms – whenever you have experienced a significant “life event,” such as the birth or adoption of a child, marriage, divorce, or the death of a relative or significant other.

Be sure to initial one or more of the options (marked A though N) on the new form; otherwise, you have not granted your agent any powers to act on your behalf. 

Additionally, if you want to be sure that you have granted your agent a “general power of attorney” – the ability to perform any and every type of legally permissible action in your place, as if he or she were you – you should include specific language to the effect that “this document shall be construed and interpreted as a general power of attorney and my agent (attorney-in-fact) shall have the power and authority to perform or undertake any action that I could perform or undertake as  if I were personally present.”

The former statutory durable power of attorney form (Section 490(a) of the now-replaced Texas Probate Code) contained this language; the new provision does not.

Because this financial power of attorney is a very powerful tool - and is also ripe for abuse by your agent under the wrong circumstances - we highly recommend that you consult with an attorney prior to signing this legal document, so that you are fully aware of the rights, responsibilities, and potential liabilities that can occur.

By: Cynthia W. Veidt,

Friday, May 22, 2015

Changes to the Texas Medical Power of Attorney Form

Texas has adopted a new pre-approved form for its Medical Power of Attorney, a/k/a the power of attorney for your financial affairs. All forms signed after January 1, 2014, must substantially comply with the new statute in order to be effective.

Luckily, the new form – still located at Section 166.164 of the Texas Health and Safety Code – is substantially similar to the previous versions of this form. And any Medical Power of Attorney form executed before December 31, 2013, will not require a revision in order to remain effective, so long as it complied with the law in effect at the time it was signed.

The primary change in the new Texas Medical Power of Attorney Form relates to its execution. Now, you can sign the form in front of a notary without the need for any witnesses. Alternatively, you can sign the form in front of two witnesses if a notary is unavailable. Section 166.163 of the Texas Health and Safety Code describes the types of persons who may act as witness to a Medical Power of Attorney.

By: Cynthia W. Veidt,

Friday, May 1, 2015

Changes to the “Self Proving” Affidavit for a Texas Will

Texas has now fully adopted the Texas Estates Code, effective January 1, 2014. This “new” set of statutes is a recodification of the former Texas Probate Code, Texas Trust Act, and a number of related statutes contained in the Texas Health & Safety Code and other statutes.

One of the most important changes involves the “execution ceremony” for a person’s last will and testament.  Previously, at least one witness was required to appear in court, usually in person, to “prove up” the authenticity of your will after your death, unless you (as testator) and the witnesses to your will also signed a separate attachment called a “self proving affidavit” before a notary public.

This process led to some confusion, because the testator and the witnesses had to sign the will in multiple places, and an “overlooked signature” would cause procedural problems for your executor.

Now, Section 251.1045 of the Texas Estates Code contains a combination “attestation and self-proving” clause, so that the testator and witnesses need only sign a Texas will in one location.  In order to be effective, the language in the will must be in “substantial compliance” with the specific language set out in this statute. We recommend copying this clause exactly in order to avoid any potential complications. 

Also, this single signature option is only effective for wills executed on or after January 1, 2014; please check your current will to make sure that it fully complies with the previous statutes concerning “self proving” language and signatures.

Because the language of your will – particularly the failure to include certain language – can affect the type of probate proceedings required to administer your estate in Texas, we strongly recommend that you contact an attorney well-versed in Texas estate planning and probate law to assist you in preparing your last will and other estate planning documents. Self-prepared wills or wills created with multi-state software programs often fail to take full advantage of Texas statutes that can help reduce the amount of cost and time required to finalize your financial affairs once you have passed away. 

By: Cynthia W. Veidt,