What is the status of the estate tax currently?

As of January 1, 2010, the Federal estate tax has been repealed -- but only for one year. As part of the 2001 tax act, Congress increased the amount persons could give away tax-free at death (the "Exemption Amount"),. This amount increased each year over a 10 year period. The Exemption Amount reached $3,500,000 in 2009 and ultimately became unlimited this year. In other words, the Exemption Amount in 2010 is equal to the value of your entire estate.

However, tax law changes were limited to a 10 year duration. Thus, in 2011, the estate tax will be reinstated with an Exemption Amount of only $1,000,000 and a rate of tax equal to 55%, the same exemption and tax rate as in 2000. Larger estates will also have an extra 5% tax that was repealed 2001, but be reinstated in 2011.

If you have questions about how the estate tax affects you specifically or if you need a Texas estate planning lawyer, contact Peterson Law Group.

How do I appoint a future guardian for my children?

In Texas, appointing a guardian for one's children is normally done in one of two ways:

1. in a person's Will
2. or in a separate Appointment of Guardian document.

While I typically include that information in a will, I prefer to also appoint guardians using a separate instrument. The reason that I prefer this approach is that a will does not become authoritative until the time of your death. On the other hand, the Appointment of Guardian is active upon death or incapacity/disability (if you are longer able to care for your child). Most people with minor children are more likely to become disabled or incapacitated than to die, so I think the second approach is the better one.

If you need a Texas Wills, Trust & Estate Planning lawyer, contact Peterson Law Group.

What is a codicil?

A codicil is a legal document that amends your existing Will without revoking the Will in its entirety. Codicils can be used to an existing will provision, a new will provision, or delete an existing will provision. Usually, if the changes someone wants to make to their will are relatively minor (for example, changing executors), a codicil is a quick, inexpensive way to amend the Will without re-drafting the entire document.

If you need a Texas Wills, Trust & Estate Planning attorney, contact Peterson Law Group.

What is a medical directive?

A Medical Directive (or Directive to Physicians) allows you to state whether you want or do not want life-sustaining treatment to be utilized to keep you alive if faced with a terminal or irreversible medical condition. It is much better for you to make your end of life decisions made in advance so that your loved ones, your doctors, and your medical power of attorney knows your desires. Typically, we include a medical directive in our standard will packages.

If you need a Texas Wills & Trust lawyer, contact Peterson Law Group.

What is a HIPAA release?

HIPAA (the Health Insurance Portability and Accountability Act of 1996) requires health care providers to be very careful how they release health care information. All health care providers are required to make reasonable efforts to limit the release of protected health information to the minimum necessary to accomplish the intended purpose of the particular disclosure or request for disclosure. A HIPAA release allows you to name one or more persons who will be able to have access to all of your information. This is especially important to have in your estate planning so that your medical power of attorney can have access to complete medical information in the event that they needed to make a medical decision on your behalf. We typically include such a release in our standard will packages.

If you need a Texas wills & trusts lawyer, contact Peterson Law Group.

What is a pourover will?

When someone has created a revocable trust, we usually create a pourover will. This will protects the individual or couple in case there is property that does not get contributed to the revocable trust. For example, someone with a revocable trust may forget to title a new car in the name of the revocable trust. In that instance, the will, when probated, would serve to place the ownership of that car into the name of the revocable trust, i.e. "pours it over into the trust".

If you need a revocable trust, pourover will, or other estate planning advice, contact the Peterson Law Group.

Key Elder Law Numbers for 2010

ElderLaw Answers released a short summary of the key elder law numbers for different federal tax and benefit programs for 2010. The summary is much better than sifting through the various governmental portals for this information.

The highlights include:

• Gift tax exclusion stays at $13,000
• There was no cost of living adjustment to Social Security and SSI since the consumer price index did not increase
• Medicare premiums, deductibles and copayments increased slightly
• The amount you could deduct from your taxes for buying long term care insurance increased slightly
• Medicaid's community spouse resource allowance, monthly mainteance and income cap remained the same as in 2009.

If you need a Texas Estate Planner, contact Peterson Law Group.