FAQ

• Yes, an EIN is required if you:
  • Hire employees
  • Operate as a corporation or partnership
  • Need to file employment or excise tax returns
  • Open a business bank account

• Yes, you can convert your business entity (e.g., from a sole proprietorship to an LLC) by filing the necessary paperwork with the Texas Secretary of State and updating tax or licensing records.

• Yes, many small business owners use their home address as their business address. However, you may want to consider privacy concerns and zoning regulations before doing so.

• An LLC offers the best of both worlds: limited liability protection and operational flexibility. It’s ideal for small to medium-sized businesses that want to protect personal assets while enjoying tax benefits, fewer formalities, and the ability to structure the company according to their needs.

• An LLC is a flexible and popular business structure that combines the benefits of a corporation’s limited liability protection with the operational simplicity of a partnership or sole proprietorship

• A PLLC or PC is a special business entity for licensed professionals (e.g., doctors, lawyers, accountants) that combines liability protection with compliance requirements specific to their profession.

• To form an LLC in Texas, you must:
  • Choose a unique business name that complies with Texas naming rules.
  • File a Certificate of Formation with the Texas Secretary of State.
  • Designate a registered agent for service of process.
  • Create an operating agreement (not legally required but recommended).
  • Obtain an Employer Identification Number (EIN) from the IRS.

• Sole Proprietorship
• General Partnership
• Limited Partnership
• Limited Liability Company
• Corporation
• Professional Corporation
• Non-profit

• The estate is responsible for settling debts. Creditors must file claims against the estate during the probate process. Beneficiaries and heirs are generally not personally liable for the deceased's debts; however, creditors may seek payment from the assets of the estate.

• Both are legal documents issued by a probate court to authorize an individual to act on behalf of a deceased person’s estate.
  • Letters Testamentary: A document issued by the court that grants the executor named in the Will the authority to manage the deceased’s estate.
  • Letters of Administration: A document issued by the court that grants an administrator the authority to manage the deceased’s estate when there is no Will, or the named executor(s) cannot serve.

• No, having a will does not avoid probate. A Will simply provides instructions for how your assets should be distributed and your affairs settled after your death. A Will does not transfer title to assets until it is probated. In order to avoid probate, a person should consider other estate planning strategies such as a living trust, Transfer on Death Deed or Lady Bird Deed, and making sure certain assets have beneficiary designations.

• In Texas, probate involves transferring ownership of assets that were solely in the deceased person’s name or were not otherwise transferred through a mechanism like a trust, survivorship agreement, or a beneficiary designation.

• In Texas, a Will must be filed for probate within four (4) years of the testator’s death.

• Affidavit of Heirship
• Small Estate Affidavit
• Muniment of Title
• Full Probate for Letters Testamentary
• Full Probate for Letters of Independent Administration with Heirship

• No, probate is not always required. If the deceased’s assets are non-probate assets (e.g., jointly owned property with right of survivorship, payable-on-death accounts, or assets held in trust), probate may not be necessary. Our Denison probate attorney can discuss probate and possible alternatives to probate if there are assets that need to be transferred to a deceased’s beneficiaries.

• If there is no Will, the estate is distributed according to Texas intestacy laws, which prioritize heirs based on their relationship to the deceased, such as a surviving spouse, children, or parents.

• Probate is the legal process through which a deceased person’s estate is settled. Through the probate process, the decedent’s Will is validated. A Will does not transfer assets until it is probated.

In Texas, establishing a trust offers several benefits:

1. Probate Avoidance: Assets in a trust bypass the probate process, allowing for a quicker and more private transfer to beneficiaries.
2. Asset Protection: Trusts can protect assets from creditors and lawsuits, depending on the type of trust.
3. Control and Flexibility: Trusts allow you to specify how and when assets are distributed, providing control over your estate.
4. Tax Benefits: Certain trusts can offer tax advantages, such as reducing estate taxes.
5. Privacy: Trusts are not public records, so they offer more privacy than a will.
6. Incapacity Planning: Trusts can manage your assets if you become incapacitated, ensuring continuity in asset management.

These benefits can vary based on the type of trust and individual circumstances.

• A trust is a legal arrangement where one party, known as the trustee, holds and manages assets for the benefit of another party, called the beneficiary. The person who creates the trust is known as the grantor or settlor. Trusts are used to manage and protect assets, provide for beneficiaries, and achieve specific financial or estate planning goals. They can be revocable or irrevocable, depending on whether the grantor retains the ability to modify or terminate the trust.

• A Lady Bird Deed, also known as an Enhanced Life Estate Deed, is a legal document used in Texas to transfer property upon the owner's death without going through probate. It allows the property owner to retain control over the property during their lifetime, including the right to sell or mortgage it. Upon the owner's death, the property automatically transfers to the named beneficiaries, bypassing the probate process. This type of deed can also help protect the property from Medicaid estate recovery.

• While not legally required, consulting an estate planning attorney ensures your documents comply with Texas law, are enforceable, align with your goals, and address complex situations like blended families or significant assets.

• Appointing an executor is a critical decision when creating a Will. The executor is responsible for managing your estate, settling debts, distributing assets to beneficiaries, and ensuring that your wishes are carried out.
• By carefully selecting an executor who is capable, trustworthy, and willing to serve, you can ensure your estate is managed effectively and your wishes are respected.

• POD and TOD designations allow you to name beneficiaries for financial accounts or real estate. These assets pass directly to the named beneficiaries, bypassing probate.

• You should review and update your estate plan after major life events, such as:
  • Marriage or divorce
  • Birth or adoption of children
  • Significant changes in finances
  • Significant changes in owned assets
  • Death of a beneficiary or executor
  • Changes in Texas or federal estate laws

• A Last Will and Testament
• Statutory Durable Power of Attorney
• Medical Power of Attorney
• HIPPA Release
• Advance Directive

• Estate planning helps you do the following:
  • Protect your assets
  • Minimize taxes and expenses
  • Avoid probate where possible
  • Ensure your wishes are honored for health and financial decisions

• Yes, even if you have a trust, it is still important to have a Will. Trusts and Wills serve different but complementary purposes in estate planning. 
  • To address assets not included in your trust
  • To name guardians for minor children
  • To minimize legal complications
  • To clarify intentions
  • To capture assets that may have not been transferred to your trust

• With other Important Documents
  • Keep your Will stored in the same place you store your other valuable documents.
• Personal Safe
  • Ensure your executor or trusted person knows the safe’s location and combination or key.
• Safety Deposit Box
  • Access can be problematic if you are the sole owner of the box. Your executor or a trusted person should be named as a co-signer or granted access through estate planning.
• Online Document Storage Services
  • A physical, original copy of the Will is still required for probate in Texas.
• Possibly in County Clerk’s Office
  • Fees may apply, and retrieval may require proper identification and proof of authority.

•  A Will does not expire. It remains valid indefinitely as long as it meets the legal requirements of your state (e.g., properly signed, witnessed, and executed) and has not been revoked or replaced by a newer Will.
• However, certain life events or changes in circumstances can affect the relevance or enforceability of your Will.

A Will is a crucial legal document that ensures your wishes are followed regarding the distribution of your assets and the care of your loved ones after your passing.