ESTATE TERMS

WHAT IS A TRUST?-- A trust is an arrangement under which one person, called a trustee, holds legal title to property for another person, called a beneficiary. A trust consists not only of property, but also of the trust instrument, the trust's beneficiaries and trustees, and the trust administrator.  There numerous ways in which to fund a trust, such as through transfer of property during your lifetime or by designating a trust as a beneficiary of your estate upon your death.  But it must be funded in order to be effective for your estate plan.  Is your trust fully funded and effective in fulfilling your legacy?  We can help you ensure it is and does, start now.

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LIVING TRUST -- A living trust is a legal document, or trust, created during an individual's lifetime (the trustor or grantor) where a designated person, the trustee, is given responsibility for managing that individual's assets for the benefit of the eventual beneficiary. A living trust is designed to allow for the easy transfer of the trust creator or settlor's assets while bypassing the often complex and expensive legal process of probate.  Is your estate plan developed so as to avoid probate?  Through our experience and expertise, we can help map your estate plan to ensure it leads to your legacy goals, start now.

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REVOCABLE LIVING TRUST – A living trust with a revocation power, which includes the power to amend, modify and revise, in addition to the power to revoke. Does your trust need updating due to life changes?  If so, we have extensive connections to estate planning firms in your local area that can ensures your estate plan leaves a lasting legacy, start now.

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IRREVOCABLE LIVING TRUST – A type of living trust where its terms cannot be modified, amended, or terminated without the permission of the grantor’s beneficiary or beneficiaries.  Once the grantor transfers ownership of assets to the trust, the grantor no longer has any legal right to the assets.  the funding of an irrevocable trust can have significant gift tax consequences if the transfer to the trust is a completed gift. Can the use of an irrevocable trust be a blessing to your beneficiaries and to your estate tax return?  We can help navigate both estate and tax planning and compliance, start now.

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SETTLOR -- A person who creates a trust; most settlors are also a “grantor” or “trustor."  The term "settlor" includes a person who creates a trust by will or through a trust during their lifetime.  In creating a trust, the settlor or grantor transfers interest in the trust property to the beneficiaries designated by the trust.

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TRUSTEE -- the person appointed, or required by law, to execute a trust, and the one in whom an estate, interest, or power is vested, under an express or implied agreement to administer or exercise it for the benefit of another.8 In other words, a trustee is a person who holds legal title to property under an express or implied agreement to apply it, and the income arising from it, to the benefit of another.  Are you the trustee for your family’s legacy?  If so, let us help carry your burden of fiduciary responsibility by supporting you every step through your journey, start now.

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EXECUTOR -- The person appointed under a will to be in charge of the estate is referred to as the executor.  In the event someone other than a person or corporation named in the will is appointed by a court to manage the decedent's estate, the title that is given to that person or corporation is administrator rather than executor.  Are you an Executor or Administrator and need help fulfilling your legal obligations in that role?  If so, we can help you figure out what to do, start now.

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PROBATE – Probate is the process related to a deceased person’s estate and is how the court confirms the transfer of assets from a deceased person’s estate to the his or her beneficiaries. The goal of probate is to collect a deceased person’s assets, pay valid claims against the estate, including last expenses, and distribute estate property to the correct beneficiaries.  The probate process is often time consuming and expense, but it may be avoided completely with proper planning.  Do you know how your assets will be transferred to your beneficiaries upon your death?  We can help you figure that out as well as how to avoid probate, if possible, so that your legacy is fulfilled, start now.

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WILL -- Wills are often used as the primary method to transfer assets on a person's death.  Wills name an estate’s executors, beneficiaries, and can make specific bequests of property.  Wills can even create testamentary trusts or disinherit certain individuals.  To be valid, a will must meet the statutory requirements.  The basic requirements for a valid will are:  1) legal capacity; 2) testamentary capacity; 3) adherence to procedural requirements; and 4) testamentary intent.  Does your will fit your intent of ensuring your legacy?  If you are not sure, we can help you figure out what to do, start now.

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TRANSFER ON DEATH (TOD) – A designation made for a property that lets beneficiaries receive assets at the time of a person’s death without going through the probate process.  In Texas, both real (e.g. a house) and titled property (e.g. a car) can be designated as TOD property.  Moreover, bank accounts and broker accounts can also be designated as TOD property.  Designation of TOD property is a cost effective way to avoid the hassle of probate.  However, making TOD designations requires filing of specific forms or documents with various financial and government institutions, which can be frustrating.  How will you ensure your property does not become a burden for your beneficiaries?  We can help with alleviating that burden, start now.

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BENEFICIARY – A beneficiary is anyone you name in your estate plan who will ultimately benefit from your estate. Beneficiaries are an important part of your estate plan, as they give purpose and guidance for what you’re leaving behind – your legacy. You can name your beneficiaries in many ways, including in your:   

• Will;  

• Life insurance policies;  

• Retirement plans like a 401(k), 403(b), IRA or similar plans; and  

• Savings and checking accounts.    

Will your beneficiaries know what and how they will receive the benefits of your legacy? Do you as a beneficiary know where to find your loved one’s legacy?  Let us help guide you in ensuring your legacy is not a burden, start now.

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