Tricks of the Trade: The Complexities of Drafting a Texas Last Will and Testament

Drafting your last will and testament is nothing like writing a love letter to your family. Unfortunately, Texas probate law is complex, arcane, and full of nuance. This complexity must be taken into account when drafting a will in order to avoid unintended consequences that could prove disastrous to your heirs long after you pass away.

The process of drafting a Texas last will and testament is best described as something akin to walking through a minefield, especially if your financial affairs are complicated. What’s even more disturbing is that some of this complexity is hidden in the legal nuances of the Texas Probate Code and various court decisions that interpret it.  Here are some tips:

  • Make sure that you include all of your estate in your will (except for any property you intentionally leave out pursuant to a strategic estate plan such as property in a living trust).

“Partial intestacy” occurs when the will doesn’t dispose of all of the property of the testator (the testator is the person who made the will). In addition to specific gifts, you should also include a catch-all “residuary clause” that reads something like “I leave all of my remaining property, including any lapsed or void gift, as follows…”

Your will should also revoke any prior wills or codicils (amendments) that you may have executed. Failure to do so could leave a probate court hopelessly confused as to your true intentions.

  • Make sure the will creates an independent administration and waives bond in accordance with Texas Probate Code §145.

This requirement is unique to Texas probate law. If you have already drafted a will under the law of another state, it is unlikely to contain the required language, since probate law is state-specific – no two states are exactly the same. You must use specific language to accomplish this purpose.

Failure to include this clause could hobble the executor’s ability to dispose of your assets in an efficient manner. In particular, many transactions might need the prior approval of the probate court. This clause must be carefully drafted to avoid unintended consequences.

  • Appropriately apportion taxes, debts, and probate expenses.

You should include language apportioning taxes, estate debts, and administration expenses so that your beneficiaries do not experience any nasty surprises. This is especially likely to be problematic if your estate is large enough to trigger the estate tax.

  • Consider creating a testamentary trust.

A testamentary trust is a trust that doesn’t take effect until you die (as opposed to a living trust, which takes effect while you are still alive). A testamentary trust can protect your beneficiary from estate creditors and from the community claims of the beneficiary’s spouse should his marriage fail after you die.

  • Consider estate tax implications of your will

The federal estate tax applies only to relatively wealthy taxpayers because of the high estate tax exemption. The amount of the exemption changes frequently, however, and the rate that applies is the rate that was in force during the year of the death of the testator.

  • Don’t make direct gifts to minors or to people receiving government benefits.

Gifting property to a minor could require the establishment of a legal guardian to receive the property on behalf of the minor. An easier way would be to either gift the property to a trust set up for the minor, or to provide that the executor must transfer the property to a custodian on behalf of the minor under the Texas Uniform Transfers to Minors Act.

Gifting directly to someone receiving government benefits could render that person ineligible for these benefits if they are means-tested and if the gift causes them to exceed a critical threshold.Certain kinds of trusts can help you get around this problem.

  • Don’t name your estate as beneficiary of a retirement account or life insurance policy.

Strictly speaking, this is not an issue involved in the drafting of your will, but it is closely related. Making this mistake could leave the proceeds of your retirement account or life insurance policy vulnerable to estate creditors and/or the IRS.

The Texas Property Code prevents estate creditors from touching most retirement accounts and life insurance policies. If you make a bequest of account proceeds, however, this protection is lost and your creditors will be rubbing their hands with glee. Your beneficiary (if someone other than your spouse) can also lose an important income tax deferral by naming your estate as beneficiary of a retirement account.

  • Pay attention to the formalities of Texas law

With narrow exceptions, a valid Texas will must be in writing, signed by the testator (or by someone else in the testator’s presence and under the testator’s direction), and attested by two credible witnesses who are at least 14 years old and who sign the will in their own handwriting in the testator’s presence.

If you die without a valid will, your property will pass to your next of kin, in a specific order, under Texas intestate succession law.

The foregoing tips barely scratch the surface of all the considerations that go into drafting an effective will that properly represents your intentions and will hold up in probate court as a valid will.

Act Today to Secure Professional Legal Advice

There’s never been any better advice than “don’t try this at home” when it comes to drafting a will to dispose of the assets of a large or complex probate estate. If you are considering drafting your last will and testament or if you have questions about an existing will, there is no better time than right now to speak with an experienced Texas probate lawyer.

We represent clients throughout Sugar Land, including Mayfield Park, Ragus Lake Estates, First Colony, Sugar Lakes, and elsewhere in Fort Bend County. Contact Romano & Sumner as soon as possible to schedule a free initial consultation. We can be reached by phone at (281) 242-0995 or though our online contact form.

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    Romano & Sumner, PLLC

    Romano & Sumner, PLLC