Wills, Powers of Attorney, Directives and More: How Estate Planning Tools Can Help with Final Arrangements

Life is anything but certain, but various legal instruments can make the unpredictable easier to manage. Wills, powers of attorney and directives are a few of these tools, and when combined, they can provide direction for end-of-life decisions.

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Here, we’ll review some of the most common legal tools and maneuvers available to those setting up their final arrangements. For most people, the best approach is to combine several of these instruments to cover every situation.

Wills: Articulating Final Wishes and Naming Beneficiaries

Wills are Law 101 for attorneys, as they’re the most popular instrument for estate planning purposes. With a will in place, people can do the following:

• Name beneficiaries and distribute assets among them
• Set up a trust and name a beneficiary for the trust
• Name a guardian for any minor children (or pets)
• Specify end-of-life arrangements, such as deciding between burial or cremation
• Donate to charities or other preferred causes
• Name an executor who will oversee the will’s administration

In short, wills articulate the testator’s final wishes, providing peace of mind to the testator and their family. As wills are generally used to provide for family following death, it’s important that they are created while adhering to state requirements. In Texas, for example, a will must satisfy the following:

• The will was written or typed out.
• The will must be signed by the testator.
• The testator must be at least 18 years old.
• The testator must be of sound mind. In other words, they must have been capable of making sound decisions for themselves when writing the will.
• The will must have a clear testamentary “intent.” This means the testator must confirm that the document they are writing is a will and that the purpose is to leave assets for named beneficiaries.
• There must be at least two witnesses present when the testator signed their will.
• The witnesses must sign an attestation, typically in the testator’s presence.

Assets named in a will must pass through probate before they are allocated to beneficiaries. During probate, a court makes final determinations regarding who receives what, using the will as the guide. Probate can be a lengthy, expensive – and public – process, but it can be expedited if the will is accompanied with a “self-proving affidavit.” This is a document that confirms that the testator signed the will, that the witnesses saw the testator sign the will, and that everyone involved was of minimum age (18 for the testator, 14 for witnesses in Texas).

With a properly formed will, that is accompanied by a self-proving affidavit, the will’s witnesses will not need to be tracked down during probate, speeding up the process.

Physician Directives: Inform Doctors of Your Medical Decisions in Advance

Physician directives, also termed advance directives, inform physicians of your medical wishes should you become incapacitated and incapable of making treatment decisions yourself. Alternatively, an advance directive can also be used to name a person who may make medical decisions for you.

An advance directive kicks in when the directive’s author becomes a “qualified patient.” To be considered a qualified patient, the following must be true:

• The person named in the directive is diagnosed with an irreversible, terminal condition.
• The diagnosis must be rendered by an attending physician.
• The physician must certify their diagnosis in writing.

If the above are all true, life-saving measures may be withdrawn as per the directive’s conditions. Using a directive, individuals may specify what conditions are relevant to the directive and what measures may be deployed to rescue the patient.

In Texas, an advance directive is only official if the following are true:

• The directive’s author is at least 18 years old.
• They are of sound mind and acting of their own free will when executing the directive.
• The directive is signed in the presence of two competent, adult witnesses.
• The author’s physician, if any, is notified as soon as the directive is created.

One of the two witnesses must not be:

• Related to the directive’s author.
• A beneficiary of the author’s estate.
• The author’s physician or one of the physician’s employees.
• Someone authorized to make medical decision on the author’s behalf.
• An employee of the health care facility in which the author subsides.

With an advance directive in place, individuals can determine how their medical affairs are handled, and how they are allowed to pass.

Powers of Attorney: Empower Another Person to Make Decisions on Your Behalf

Powers of attorney (POAs) grant other people, called agents, the right to make legal, medical or financial decisions on behalf of an authorizing party, the principal. POAs cover a wide range of powers. Depending on the POA, agents may make the following decisions:

• What forms of medical treatment may be used
• Managing decisions for a business
• Submitting payments to creditors or for other financial obligations
• Filing tax returns
• Overseeing bank account activity
• Making beneficiary designations
• Selling property and managing other assets

POAs can either be temporary or “durable,” in that they remain in effect even when the principal becomes incapacitated or otherwise unable to make their own decisions. They can also be set to activate in response to specified conditions. Referred to as a “springing” POA, these powers of attorney describe which conditions would cause the POA to be put into effect. This could be the onset of a particular medical condition or when the principal dies.

We recommend developing POAs so that they take effect immediately. That way, if the principal is suddenly incapacitated, there’s no delay in confirming the POAs conditions and ensuring financial and medical decisions can be made without interruption.

HIPPA Release: Allow Others Access to Your Medical Information

A HIPPA release or authorization form gives medical institutions permission to provide relevant medical information to people named in the release. A HIPPA release does not allow those people to make medical decisions, but it does provide critical information that can assist in the decision-making process. A release also entitles the named individuals to receive updates about the patient’s condition.

HIPPA releases are also used to demonstrate incapacitation for trust or POA purposes and are therefore essential for preventing delays when enacting these legal instruments.

Guardianship: Expansive Powers Backed By Court Orders

Legal guardianship is similar to a POA, though typically more expansive in scope. The guardian is usually the one with authority to make medical and financial decisions for their ward, so they have major influence over their ward’s day-to-day decision making.

Guardians may be named in a will (such as when designating who will care for minor children), but they must be approved and overseen by a court. In some instances, it is the court that will make the final decision regarding guardianship.

The benefit of attaining legal guardianship is the additional power that a court order conveys. Though uncommon, some medical or financial institutions may resist responding to a POA and make it difficult for agents to act on the principal’s behalf. Those institutions will not resist a court order.

Work with an Estate Planning Attorney to Determine Which Estate Planning Tools Are Right for You

If you’re concerned about providing for family after passing, or are concerned about how certain medical, financial or legal decisions will be made, there’s a legal document for that. Whether it’s a will, a POA, a directive, a release, or guardianship, an Houston estate planning attorney can use all of the available legal instruments to ensure your final wishes are observed.

By Harold "Hap" May, P.C. on November 2, 2023   /   Blog, The Legal Play Podcast   /   Leave a comment