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Planning Ahead: Things to Consider

Intestacy in Texas

PLANNING AHEAD:  THINGS TO CONSIDER

Advanced Directives

• Instructions expressing your wishes in case of incapacity and/or directing the appointment of agents to make decisions for you (Powers of Attorney, Living Will, DNR, and Declaration of Mental Health Treatment are types of Advanced Directives).

Durable (General/Financial) Power of Attorney

• Appoints an agent to manage your financial and personal business affairs. 
• You can grant specific powers, such as managing bank accounts, transferring real estate, or other affairs, or you can appoint a General Power of Attorney (POA) that allows the agent to handle everything. 
• A Power of Attorney can grant immediate power that continues through incapacity (“durable”), or it can grant power upon the occurrence of some condition, such as incapacity (“springing”). 
• Some banks, financial institutions, or mortgage companies require their own forms, or they may make it difficult to use the standard form.  If you are considering a Power of Attorney to handle transactions dealing with such entities, you should call ahead and find out what they use. 
• Lastly, spouses may consider granting each other POA, so that there are not any problems dealing with separate property, joint real estate, or other property, if one spouse is incapacitated or absent for a period of time.

Medical Power of Attorney

• Type of advance directive that appoints an agent to make your healthcare decisions, in the event you are no longer able to do so.
• A Medical Power of Attorney (MPA) becomes active when you are unconscious, incapacitated, or otherwise unable to make medical decisions for yourself.  A MPA is generally more useful than a living will, but it may not be a good choice if you don’t have another person you trust to make these decisions for you.
• However, the power of a MPA is limited - in general, your agent cannot put you in any facility for inpatient mental health services, convulsive treatments, psychosurgery, or abortion.  Furthermore, your attending physician must certify in writing that you are unable to make health care decisions, and file the certification in your medical record.

Living Will (also known as Directive to Physicians)

• Type of advance directive that expresses your wishes with regard to the use of life-sustaining treatment, in the event you become terminally ill or incapacitated due to injury, disease, or illness.
• A Living Will allows you to make a decision; there is no agent appointed.  It informs your doctor of your wishes, and it relieves your family of having to make a very difficult decision – whether or not to continue life-support.  It is a good idea to have one if you plan on undergoing surgery. 

Medical Power of Attorney vs. Living Will (Directive to Physician)

• A Living Will (LW) differs from a Medical Power of Attorney (MPA) in that the LW deals with life support issues when your illness is terminal.  The MPA authorizes a person to make all other medical decisions on your behalf if you are unable to do so, such as whether to administer pain medication or undergo a surgical procedure.  It is not necessary to have both documents, but if you have both, you should be sure they do not conflict. 

   
 
DNR (Do Not Resuscitate)

• Type of advance directive that instructs that certain resuscitative measures not be used, such as not to have cardiopulmonary resuscitation (CPR) if your heart stops or if you stop breathing.  Other resuscitative measures specifically listed in a DNR are advanced airway management, defibrillation, artificial ventilations, and transcutaneous cardiac pacing.
• A DNR order should be put in your medical chart by your doctor, and they should be accepted by doctors and hospitals in all states.

HIPAA

• Privacy rule that creates national standards to protect individuals’ medical records and other personal health information.
• There is a form that you can sign that waives your rights to privacy and grants certain individuals the right to obtain medical information.  Some people sign a HIPAA release granting the agent appointed in their MPA access to their medical records, or sometimes the release is required in litigation or other investigations. 

Trust

• A trust is created when a property owner (Trustor/Grantor/Settlor) transfers legal title of an asset to a person (Trustee) who has the duty to hold and manage the asset for the benefit of one or more persons (Beneficiary).

There are different kinds of trusts:

• Testamentary trust – created in a Will and comes into being at death (or some future time); usually created to provide for the management of assets, creditor protection, and tax benefits; may also be appropriate for minors, disabled adults, persons who are spendthrifts or lack sound financial judgment.
• Inter vivos trust – created during the life of the Trustor; can be revocable (can be changed) or irrevocable (permanent); sometimes called “living trust” (see below).

Intestacy

• When you die without a Will, you die intestate.  The Texas Probate Code provides for an order in which heirs can inherit and divide your estate.  See Flow Chart. 

Will

• Document that allows you to direct the distribution of your estate.

Will vs. Intestacy

Benefits of having a Will

1. Provide for disposition of your assets according to your specific wishes;
2. Avoid passing assets to those you want to exclude, who would otherwise inherit under intestacy;
3. Designate guardian or trust for minors or incapacitated adults;
4. Provide for management of assets;
5. Reduce likelihood of disagreements over property;
6. YOU appoint executor/trustee/guardian, rather than the court;
7. Provide for charitable gifts;
8. Coordinate will or trust with beneficiary designations of non-testamentary assets.

INTESTACY IN TEXAS

What happens when you die without a Will

This chart is provided for informational purposes only and should not be construed as legal advice. Distribution may vary depending on an individual’s particular circumstances. Please consult with an attorney.