In short, estate planning is the process of making instructions for the management of your estate. Once you start making an estate plan, you will likely quickly realize that it is not as difficult as others made you believe.  However, it is easy to make mistakes when planning out your estate. Here are a few to avoid: Leaving all of your assets to a single beneficiary You could leave all of your assets to one person, such as a spouse, child or sibling. This would make the process easier and quicker for your beneficiary. However, you could outlive your beneficiary. If this happens, your ass ..read more

A power of attorney empowers a designated individual, called your agent in Texas, to act on your behalf in financial and/or medical matters, subject to conditions of your choosing. Choosing the right person for this critical role is essential. Texas law allows you to appoint any competent adult (at least 18 years old with sound mind) as your agent in a power of attorney scenario. They can be a family member (spouse, adult child, or sibling) or a close friend with proven loyalty and responsibility. Some designate a professional, such as a trust company or fiduciary, to act as their representati ..read more

In the past, we’ve discussed giving someone durable financial power of attorney (POA). Just as important is the person to whom you give medical POA. Under Texas law, a person with medical POA (also known as an agent) can consult with a patient’s (principal’s) medical team and make decisions on their behalf “according to the agent’s knowledge of the principal’s wishes, including the principal’s religious and moral beliefs; or if the agent does not know the principal’s wishes, according to the agent’s assessment of the principal’s best interests.” The best way to ensure that your agent (and your ..read more

A power of attorney in Texas authorizes a person to take action on behalf of another person. When you create a power of attorney you become the principal. The person you choose to act on your behalf is the agent. Why would anyone override a power of attorney? Powers of attorney are legally binding, but sometimes it becomes necessary to override the authorization. For example, your family and friends might discover the agent is unfit for the role due to abusing their position. What are the options for overriding a power of attorney? If you’re the principal and of sound mind, the concerned parti ..read more

When registering your business, deciding whether to choose LLC status or to be classified as an S Corp can have far-reaching implications for taxation and liability. If you ultimately choose an LLC structure, it’s important to know that you can elect to have your LLC taxed as an S Corp instead of as a pass-through organization, should you choose. This choice of tax classification will determine how the IRS treats your business for federal income tax purposes. Opting to have your LLC taxed as an S Corp can offer several benefits. Simplified tax reporting Businesses that elect S Corp status can ..read more

When a business is set up as a C Corp, this refers to the IRS code. This business would be registered under subchapter C of that code, which is the default position for many businesses. It can grow at an unlimited rate, and it is an independent legal entity. However, one important thing to note about C Corps is how taxes are handled. It can lead to a phenomenon known as double taxation, wherein the money that travels through the business is taxed twice by the government. People are often looking for ways to get around this issue so that more of the money stays with the company, the owner and/o ..read more

In Texas, a financial power of attorney (POA) is a legal document that grants an individual, known as the agent, the authority to make financial decisions on behalf of another person, known as the principal. This role encompasses various responsibilities, from managing day-to-day financial transactions to handling more complex matters such as real estate sales or investment decisions. A financial POA is generally treated as a durable power of attorney that aims to ensure that the principal’s financial affairs can be managed efficiently if they can’t do so themselves due to physical or mental i ..read more

When managing a trust, various complexities can lead to disputes among those involved. Trust disputes commonly stem from specific issues related to the trustee’s actions, the validity of the trust, or the interpretation of its terms. Understanding these common reasons for trust disputes is essential for navigating trust management’s often intricate and sensitive nature. Each type of dispute requires careful consideration and potential legal intervention to resolve.  Questions about the trustee’s actions A breach of fiduciary duty, where the trustee fails to act in the best interests of th ..read more

In Texas, you’re required to form an LLC or C corporation before electing to operate as an S corporation. Many people opt to form an LLC instead of a C corporation because it is less formal and provides more flexibility. The main differences between the S corporation and the traditional C corporation are the tax implications and the ownership structure. Many choose the S corporation to avoid the double taxation inherent in C corporations. S-corps vs C-corps The S corporation is not required to pay corporate-level income taxes. The profits and losses pass through to shareholders and are reporte ..read more

Having a power of attorney in Texas is critical to ensuring respect for your wishes. Yet, this essential legal document often doesn’t provide enough information to carry out its aim. The below information outlines some key complications to a power of attorney and how to avoid them. Too much power in the hands of another A power of attorney, by definition, is a legal document designed to allow the person you choose, known as your agent, to act on your behalf. However, one of the many power of attorney issues and pitfalls is allowing your agent too much power without vital directives. Drafting c ..read more