Maximize Your Inheritance with Texas Trusts and Estate Planning

 Posted on November 08, 2023 in Estate Planning and Administration

Texas has unique laws regarding trusts and estates that allow residents to maximize inheritances for their families. Proper estate planning is essential to take advantage of these laws and avoid unnecessary taxes or legal disputes. A Texas lawyer can help you with key strategies you can use to preserve more assets for your loved ones.

Use Trusts to Avoid Probate

Texas allows the use of revocable living trusts to avoid the probate process on assets placed in the trust. Upon death, assets in a revocable living trust can be distributed immediately to beneficiaries without court intervention. This saves time, legal fees, and the potential for legal challenges. You should consider creating revocable living trusts and re-titling assets, including real estate, bank accounts, and investments into the trust. This ensures a smooth transition of assets upon death.

Take Advantage of Texas Estate Tax Laws

Texas does not have a state estate or inheritance tax. This means upon death, you can pass all assets to heirs estate tax-free. However, federal estate taxes still apply to estates over $12.06 million (in 2022). Proper planning, including using trusts and gifting assets while living, can minimize federal estate taxes. Creating irrevocable trusts to remove assets from the taxable estate for large estates can maximize inheritances.

Use Community Property Laws to Spouses’ Advantage

Texas is a community property state. This allows spouses to double their estate tax exemption and pass double the assets estate tax-free. Proper planning allows a married couple to shield up to $24.12 million from federal estate taxes. Community property laws can also provide significant advantages for spouses inheriting retirement accounts.

Review Estate Plans Regularly

Laws and asset values change over time. To maximize inheritances, you should review estate plans regularly, especially after significant life events like marriage, divorce, births, or acquiring property. An outdated plan can lead to avoidable taxes or disputes. Meet with an attorney every few years to evaluate if estate plans still achieve your goals.

Communicate Plans Clearly to the Family

Avoid potential confusion and fighting by clearly communicating plans with all family members. Make intentions clear about distributing specific assets and selecting trustees or guardians for minor children. Put plans in writing to minimize disputes.

Contact a Hood County, TX Estate Planning Lawyer

Your estate and assets should be taken seriously, and you should ensure your plan is thorough so there are no gaps in the documents. Contact an experienced Tarrant County, TX estate planning attorney to implement strategies to maximize inheritances. With proper trusts and estate planning, you can strategically pass more wealth onto the next generation. Call Cain & Kiel Law at 817-645-1717 to get started on your estate the proper way so you know your family will be taken care of.