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Experience and Training Make the Difference in Estate Planning

Editor’s Note: The information in this column is not intended as legal advice but to provide a general understanding of the law. Any readers with a legal problem, including those whose questions are addressed here, should consult an attorney for advice on their particular circumstances.

This week I reviewed a client’s estate plan with her (which I recommend be done every 5 to 10 years). She had several questions and I helped put her mind at ease. Her questions were quite good and many have the same, so I thought it would be a good subject for this week’s column.

As a brief synopsis, a Will names your Executor and provides for distribution of your estate to your beneficiaries, after the payment of any debts and the expenses of probate.

The Executor is responsible for filing the Will for probate in a timely manner, paying the debts of the estate and expenses of probate from the assets of the estate, and distributing the residue according to the Will. Some may choose to name Co-Executors. If for any reason one of the Co-Executors refuses or fails to serve as Co-Executor, the remaining Co-Executor may file a motion with the court to be appointed the Executor of the Will. If the first named Executor fails or ceases to serve as Executor, the next named Executor may be appointed to serve. If all the designated Co-Executors fail or cease to serve, I recommend the Will provide that the probate judge shall appoint a bank with a trust department to serve as Executor. This is to avoid the appointment of someone you do not want and puts the job in the hands of a bonded and insured entity that is familiar with handling estates.

Another common question is about the time line for probate. The Executor must file the Will for probate within four years of your death or they cannot probate the Will and your estate will pass as though you died without a Will. Other than the four year limitation on the filing of the Will for probate, it is difficult to estimate how much time it will take to conclude the probate because that is affected by the debts of the estate, the real estate market if property must be sold, and the nature of the assets and investments. The simplest probate may be concluded in a couple of months. I have had personal experience with complicated probates lasting six or seven years.

Informing the person(s) you name as executor and organizing your affairs so that they can find information such as your bank, insurance representative, deeds to real estate, investment planner, and vehicle titles is a great help. However, don’t forget to include information about your utility providers, digital assets (accounts you may have online) and contact information for family or friends. Often the person you select is a relative, but they are busy with their own responsibilities and not keeping track of your details. It will save them time and cause less stress if you have things well organized for them. This falls in the category of do what I say, not what I do, as my desk is a mess.

Many question what happens to a beneficiary’s share if the beneficiary dies. A well drafted Will provides that if a beneficiary dies before you, where that deceased beneficiary’s share will pass instead. Often this is to the deceased beneficiary’s issue (or children). Issue would be blood descendants of that beneficiary and descendants formally (legally) adopted. For example, if one son died before you and he had two children, they would divide his l/2 share and each would receive l/4 of your estate. If either of those two grandchildren predeceased you, but left three great grandchildren surviving, each great grandchild would receive l/3 of l/4, or 1/12 of your estate. Spouses of your beneficiaries or of their descendants do not inherit from you, unless formally stated in the Will. Nor do step-children, unless formally adopted or stated in the Will.

However, if your beneficiaries are living at your death and one later dies, he/she may by their own Will distribute their inheritance to whomever they choose, including a spouse or stepchildren. The only way to avoid this would be to put all of that beneficiary’s share in a trust for your grandchildren. If you think that may be a good resolution to your particular situation, you should meet with your estate planning attorney to discuss the details further.

Many clients ask for separate trusts for each of their grandchildren. If this is something you would like to do, again you should meet with your estate planning attorney to work out the best way to do so. An attorney with training and experience in estate planning is best suited because you want to avoid issues in the future and devise the best plan possible.

Do not name Co-Executors if you have any concern about whether they would be able to cooperate with one another as Co-Executor. My experience has taught me that if they do not get along extremely well now, they probably will not work well together as Co-Executors, which could have the effect of prolonging the probate and creating further conflict between them. I hope to complete one such probate soon. While it was a fairly simple estate, the deceased had a poorly drafted Will with Co-Executors who do not get along and, as a result, it has taken far too long and cost far, far too much.

I hope that this information is helpful. If you have not reviewed your Will in the last 5 to 10 years, I encourage you to do so. If situations have changed and you wish to update your Will, then I recommend you call an attorney trained and experienced in estate planning.

Sam A. Moak is an attorney with the Huntsville law firm of Moak & Moak, P.C. He is licensed to practice in all fields of law by the Supreme Court of Texas, is a Member of the State Bar College, and is a member of the Real Estate, Probate and Trust Law Section of the State Bar of Texas. www.moakandmoak.com.