Understanding the Fiscal Cliff Legislation

Newsletter 1-18-13

Texas Public Information Act; Government Code Section 552.001

A client and I were discussing the Open Records laws in Texas and she referenced Government Code Section 552.001 as “poetic prose.”  A description like that about a government statute (??) . . . well, I had to read it for myself.  I have to say, she accurately described the statute.  I have posted the full text for you to read.  It truly is beautifully written to describe our right to information and makes me wonder about all these closed door sessions that we hear about so often.  Is it strange that I enjoy reading this?

Sec. 552.001.  POLICY;  CONSTRUCTION.  (a)  Under the fundamental philosophy of the American constitutional form of representative government that adheres to the principle that government is the servant and not the master of the people, it is the policy of this state that each person is entitled, unless otherwise expressly provided by law, at all times to complete information about the affairs of government and the official acts of public officials and employees.  The people, in delegating authority, do not give their public servants the right to decide what is good for the people to know and what is not good for them to know.  The people insist on remaining informed so that they may retain control over the instruments they have created.  The provisions of this chapter shall be liberally construed to implement this policy.

(b)  This chapter shall be liberally construed in favor of granting a request for information.

Added by Acts 1993, 73rd Leg., ch. 268, Sec. 1, eff. Sept. 1, 1993.

(emphasis added).

Advance Directives (also known as Living Wills) in Texas

An Advance Directive (aka Living Will) is used to advise your physician whether you want life-sustaining treatment if you have either (1) a terminal condition (expected to die within 6 months even if you receive treatment) or (2) an irreversible condition (may be kept alive indefinitely with treatment, but you are left unable to care for or make decisions for yourself), AND you are mentally incompentent or physically unable to communicate with your doctor. You may also make other directives in the document for things like, whether to administer pain medication, antibiotics, or artificial hydration.

If you have not executed an Advance Diretive and a decision about whether to withhold or withdraw life-sustaining treatment has to be made, then the attending physician and your legal guardian or agent under a medical power of attorney will work together to make the decision for you. If you do not have a legal guardian or an agent under a medical power of attorney, then the attending physician and one person from the following list (listed in priority) will make the decision that may include withholding or withdrawing life-sustaining treatment: (1) spouse, (2) adult children, (3) patient’s parents, (4) nearest living relative. The decision should be made based on knowledge about what you would desire, if it is known to the individual involved.

I believe that executing a well thought out advance directive can be a gift to your loved ones because it takes the difficult decision to maintain or withdraw life-sustaining treatment out of their hands. You have already made the decision to maintain or withdraw treatment so that your loved ones do not have the burden and emotional expense that can result from making that kind of decision for someone they love.

 

Disclaimer: The information in this site is not comprehensive and should not be construed as legal advice. Further, reliance on any information contained in this website does not constitute the formation of an attorney-client relationship. You should seek the assistance of an experienced attorney for specific legal advice regarding your particular circumstances.

Three Reasons to Create a Limited Liability Company

If you are starting a new business or have been operating a business as a sole proprietor, you may be considering the possibility of establishing your business as a limited liability company (LLC). There are advantages to making your business an LLC.

1. Limited Personal Liability. The primary reason most of my clients make the jump from a sole proprietor to a business entity is to limit their personal liability exposure for business operations. LLCs provide a level of liability protection, preventing creditors from seeking to satisfy business debts through the owner’s personal assets (such as the personal house, car, and bank accounts). Without a limited liability legal entity, operating as a sole sole proprietorship exposes an owern’s personal assets to risk of loss.

2. Tax Advantages. In Texas, an LLC can elect to be taxed as a sole proprietor, partnership, or corporation, depending on the current circumstances of the business. The owner can choose corporate taxation, where the LLC is taxed at the business level and the members pay taxes on their individual distributions. Or, the owner can choose “pass through” taxation for the LLC, where no tax is paid at the business level (subject to the state franchise tax, if applicable), but the profits and losses are passed through to the individual owner(s) and reported on their income tax returns. The net profit of the business is not deemed income to the owner and is therefore not subject to self-employment tax. Additionally, operating expenses and depreciation of the company assets can be deducted from the gross revenues of the LLC.

3. Credibility. Forming an LLC establishes business credibility and trustworthiness with potential customers. Potential investors, employees and vendors tend to deem business entities as less risk than sole proprietors.

Of course, these are not the only benefits, but these are the the three main advantages that interest my clients who are seeking to establish a LLC.

Interestingly, the biggest challenge in creating an LLC in Texas is finding a name that hasn’t already been taken . . . but that is a topic for another entry.

Texas Intestacy Law

If you are a Texas resident and you die without having a Last Will and Testament, the State of Texas will decide who gets your assets. The is is what happens to your assets under Texas intestacy laws.

A. If you have no spouse, your assets will be distributed as follows-
1. to your children and their descendants.
2. If you have no living children or descendants, then to your father and mother, equally.
3. If one parent is living, and one is deceased, your living parent will get 1/2 of your assets, and your deceased parent’s siblings and their descendants (your cousins) will get the other 1/2 of your assets.
4. If your deceased parent has no siblings, then your surviving parent will receive your entire estate.
5. If you have no living children or descendants, and both of your parents have predeceased you, then to your siblings and their descendants.
6. If you have no living children or descendants, your parents have both passed away and you have no siblings (or nieces / nephews), then your estate shall be distributed, one half to your father’s kindred and one half to your mother’s kindred: grandparents first, then their descendants and lineal ancestors.

B. (Separate Property) If you leave a spouse when you die, things get more complicated. Your separate property assets (non-community property, meaning items acquired before the marriage, or by inheritance or gift during the marriage) will pass as follows:
1. your spouse will take 1/3rd of your separate (not community) personal property, and the balance of your separate personal property shall go to your children and their descendants.
2. your spouse will also be entitled to a life estate interest in 1/3rd of your separate (not community) real estate, with the remaining 2/3rds passing to your children and their descendants. (A life estate interest means that your spouse will own a 1/3rd share of the property for his/her life time, but s/he does not have the right to say who gets it when s/he dies).
3. If you leave your spouse, but no children, then your spouse will take all of your separate persoanl property and 1/2 of your separate real estate. The other 1/2 of your separate real estate shall pass according tot he laws of descent listed above in Section A up to the point of your parents and siblings. If you die without parents, siblings, nieces/nephews, then your spouse will be entilted to all of your estate.

C. (Community Property) If you leave a spouse when you die, your spouse will retain his or her 1/2 community property interest in the community property assets, whether personal property or real estate. Your 1/2 community property interest in the community assets will pass as follows:
1. to your spouse if you have no surviving children or if all of your surviving children are children of you and your living spouse.
2. If you have surviving children who are not children of your spouse, then your spouse will retain his or her 1/2 community property interest, and your 1/2 interest will pass to your children and their descendants. In other words, your spouse and your children from another relationship may own property jointly and neither of them can do anything with it unless they work together or a court intervenes. Wow, that can cause problems!!

Is this the estate plan you have in mind? If not, consult with a qualified estate planning attorney to create the plan YOU want.

Open House

The Law Office of Elizabeth Raxter is hosting an Open House on Tuesday, Sept. 27th, from 4p-7p. The Open House will be located in the Community Room of the Golden Age Home, Private Business Wing. Please stop by to say hello, sign the guest book, and enjoy light refreshments.

LOCAL ATTORNEY RECEIVES CERTIFICATION IN ELDER LAW

FOR IMMEDIATE RELEASE August 23, 2011

Tucson, AZ – The National Elder Law Foundation (NELF) – the only organization approved by the American Bar Association to offer certification in the area of elder law – has announced that ELIZABETH RAXTER of LOCKHART, TEXAS has successfully completed its examination and review leading to such certification. Ms. Raxter is 1 of 20 attorneys in the State of Texas and 1 of 428 attorneys in the United States to achieve the elder law certification.

Certification in elder law – one of the fastest growing fields in the legal profession – will provide a measure of assurance to the public that the attorney has an in-depth working knowledge of the legal issues that impact the elderly.

ELIZABETH RAXTER, a sole practitioner at the Law Office of Elizabeth Raxter in Lockhart, Texas, is now a Certified Elder Law Attorney. ELIZABETH RAXTER has practiced law for thirteen years and focuses her practice on wills, trusts and estate planning, probate, guardianship, special needs planning, and public benefits. Elizabeth Raxter is a graduate of Texas A&M University and William S. Richardson School of Law at the University of Hawaii in Manoa. She has been a resident of Lockhart since 2005. The Law Office of Elizabeth Raxter is located at 1505 S. Main, Suite 1008, in the private business office wing of the Golden Age Home.

For more information, contact ELIZABETH RAXTER at (512) 398-6996.

One-Step Will Signing – One of the Many Changes to the Probate Code

Currently, to execute a “self-proved” Will in Texas, so that witnesses to the Will need not appear in court during the probate procedure, a Testator (person making a Will) must sign the document twice – once on the Will itself in front of two witnesses, and again on a Self-Proving Affidavit in front of witnesses and a notary public. The new law, which becomes effective September 1, 2011, allows an optional, stream-lined second method wherein the Testator, witnesses and notary public may sign one time on the Will document, thereby eliminating the Self-Proving Affidavit.

Leaving a Charitable Bequest through a Retirement Account

If you are thinking of leaving a gift to a charity at your death, you might consider designating the charity as a beneficiary on certain types of retirement accounts. Unlike an individual who is named as a beneficiary, a charity will not have to pay income taxes on the gift. Additionally, while an individual may receive a step-up in basis on many testamentary gifts, he/she will not get a step-up in basis when named as a beneficiary on a retirement account. If you were considering making a charitable gift at your death, it might be better to leave all or part of your retirement account, and leave a different asset to your loved ones so that the individuals who inherit from your estate may be put in a better position with regard to taxes, and thereby enjoy more of the gift. Your estate will be able to claim a charitable deduction and the gift may even save estate taxes. These are just a few of the benefits in making such a designation, not to mention the feeling you get when you give to help a charity.