Estate planning can be an uncomfortable subject to think about because it requires thinking about your death. However, thinking about your death is a necessary part of life, and thinking about it now can give you and your family peace of mind for when it comes, whether it’s inevitable or unexpected.
Probate is a legal process that can complicate matters of your estate upon your death, placing more financial and emotional hardships on your survivors during an already difficult time. To avoid probate in Oklahoma, it is important for residents to understand local laws and plan their estates appropriately. Here, we’ll explore the realities of the Oklahoma probate system and what you can do now to plan for it. We’ll also discuss the steps you need to take now, including your options and various types of estate planning documents, to avoid probate in Oklahoma.
Estates Aren’t Just for the Wealthy
Most people associate an estate with something that only the rich and famous have. However, almost everyone has an estate, no matter their income or net worth.
Your estate is everything you own—your car, your home, your savings account, your life insurance policy, and more. Essentially, it’s anything that would be left to your loved ones in the event of your death.
What happens to your estate when you die?
When you die, your estate—which means all your assets—is distributed to your heirs and beneficiaries. Heirs and beneficiaries may include a spouse, child, grandchild, another relative, or even an organization or charity–anyone you specifically indicate in your will to receive something upon your death.
If you do not have a will, the state of Oklahoma has a method of dividing your estate or property depending on whether or not you have surviving relatives and who they are, though without a will, it may not be how you wanted it allocated.
*Note: In Oklahoma, if there are no surviving family members or relatives and you do not have a will specificing any other distribution of assets, your property will be transferred to the state. However, Oklahoma’s laws are written such that this rarely happens; the state does everything possible to distribute property to surviving relatives, no matter how remotely they are related.
What is probate?
When you die, your estate may have to go through probate, whether you have a will or not. Probate is the legal process of distributing your assets upon your death, and without proper planning, it can be long and costly for your loved ones.
At the start of the probate process, a person will be appointed executor or administrator of the estate and is responsible for identifying, collecting, and distributing all assets you owned at the time of your death. The process may also involve settling debts, paying taxes, and making sure that any remaining personal property items are distributed according to your wishes.
Probate in Oklahoma
To initiate probate of a will, Oklahoma state statutes require that anyone in possession of a will must present it within 30 days of a person’s death. Property that must go through probate is any property owned solely by a deceased person that does not have a beneficiary, such as real estate or bank accounts in one person’s name only. It is important to note that if you have an estate worth more than $200,000, it must go through probate in Oklahoma.
In Oklahoma, the probate process typically takes six to twelve months, depending on the complexity of the estate. Probate can tie up assets for months or even years and incur several types of fees which must be paid. These include court costs, appraisal fees, newspaper publication fees, and attorney fees.
Estate Planning and How it Works
Although probate is necessary in most cases in Oklahoma, planning ahead can help your survivors avoid much of the process, or even the entire process altogether.
Even if you don’t think you have much to leave behind, it’s important to plan all aspects of your estate, because anything you don’t plan for will have to go through probate. By taking the time to plan your estate now, you can save your loved ones the headache, heartache, and expense of probate down the road. Plus, you can ensure that your assets are distributed according to your express wishes and not the state’s default rules.
An estate plan often includes the following:
- Will
- Trust(s)
- Beneficiary designation
- Powers of Attorney
- Healthcare or medical directive
Of these, a living trust and beneficiary designation will be most helpful for avoiding probate. Additionally, joint ownership of property and payable-on-death designations will ease the transfer of ownership without having to go through probate.
Living Trusts
If you own real estate, bank accounts, vehicles, or other assets, you can avoid probate in Oklahoma by making a revocable living trust. To do this, you set up a trust, which is a document like a will, that lists yourself as trustee and names someone to take over as trustee after you die. Your property is transferred to the trust, but you still retain ownership of it as trustee. Upon your death, your successor trustee will be able to transfer the trust’s assets to any identified beneficiaries without having to go through probate.
Joint Ownership
Joint ownership allows assets that are jointly owned upon the death of one owner to pass directly to the surviving owner.
Joint ownership can take many different forms, including tenancy in common, joint tenancy with right of survivorship, and tenancy by the entirety. Each type has its own unique benefits and drawbacks, so it’s important to consult with an experienced attorney to determine which is best for your situation.
Beneficiaries and Payable-on-Death or Transfer-on-Death Designations
In Oklahoma, you can avoid probate by designating a beneficiary or beneficiaries for your assets. For some assets, you can do this directly or through a pay-on-death or transfer-on-death designation. These designations are deeds put into place for bank accounts, real estate, and other assets to help avoid probate.
A payable-on-death beneficiary can be anyone—a family member, friend, or even an organization. They are most often set up with bank accounts so that the funds in the account are transferred to them upon your death.
A transfer-on-death deed is a way to transfer the title of real estate to a beneficiary after your death.
You can designate a beneficiary for any of your assets—bank accounts, investment or retirement accounts such as an IRA or 401(k), life insurance policies, and even real estate. Designating beneficiaries is easy to do, it doesn’t cost anything, and it’s an excellent way to avoid probate.
Estate Planning at Any Age
It’s never too early to begin planning your estate, and doing the planning now can help your loved ones avoid probate later. Here are the most important aspects you’ll want to focus on at different stages of your life.
In Your 20s and 30s
After you turn 18, you are legally an adult, and your parents can no longer make decisions for you. While you’re young and single, you need a general plan in case something happens and you are not able to make decisions for yourself, such as if you are injured in an accident. At the minimum, you should have a:
- Power of Attorney: Names someone who can make financial or healthcare decisions on your behalf if you are unable to. There are several different types of powers of attorney, including medical, general power, limited power, and durable. An experienced law professional can help you determine which is best for your unique situation.
- Healthcare Directive: Specifies what medical actions you would like to happen if you become incapacitated and are not able to make decisions about your health. Healthcare directives are also commonly called advanced directives or living wills.
In Your 30s and 40s
By the time you have reached your 30s and 40s, you have probably started to accumulate some assets, such as a home and investment accounts. You may also be married and/or have children.
Powers of attorney and healthcare directives will still be important, even if you are married or in a long-term relationship. Powers of attorney can line out who can make decisions for your children, your property, and your health, while a healthcare directive can make it easier on your spouse or significant other and surviving parents or family members to make healthcare or end-of-life decisions for you should something happen.
Other estate planning documents you will want include:
- Wills: Spells out who your heirs are and what they will inherit.
- Trusts: Transfers ownership of your property to a trustee and can help avoid probate.
- Guardian for your minor children or other dependents: If you have minor children or other dependents, such as medically-dependent adult children, you will want to appoint someone to care for them if you and your spouse cannot.
In Your 50s and 60s
It’s never too late to start planning your estate, even if you are looking at retirement. Whether you’re just beginning or if you have a plan in place, it’s time to check all documents and make sure they are updated and accurate. Be sure to:
- Review Powers of Attorney and Healthcare Directives
- Update wills, trusts, and beneficiary designations
- Purchase long-term care insurance
In Your 70s and Beyond
At this age, you should have your estate plan in place. Periodically review the documents with your attorney to make sure they are accurate and make changes as needed. Your beneficiaries and heirs may change, and it’s important to keep your estate plan clear and reflecting your wishes. Continue to:
- Review Powers of Attorney and Healthcare Directives
- Update wills, trusts, and beneficiary designations
- Refine plans for long-term or end-of-life care
Experienced Estate Planning from the Law Office of Shannon D. Taylor
When it comes to estate planning, the team at the Law Office of Shannon D. Taylor knows there are often more questions than answers. That’s why we’re here to support and guide you and your loved ones through the complexities of estate planning in Oklahoma.
For 17 years, the Law Office of Shannon D. Taylor has been helping Oklahomans plan their estates with dignity, with a special focus on same-sex and LGBTQ+ families. We represent families and individuals regardless of their level of preparedness or financial status, and we serve every client with respect and compassion. Find out more about our probate law services here or contact us to schedule a consultation. Don’t wait another day to start planning for the future.
Disclaimer: This article is for informational purposes, and contains the opinions of the author based on information currently available at the time of publication. This article is written by an attorney, but it is not legal advice, nor does it create an attorney-client relationship. The contents of this article are true and accurate to the best of our knowledge, information, and belief, but there may be inadvertent omissions or mistakes. Use of this information without consulting a qualified professional is at your own risk. We would love to serve as your attorney but we do not and cannot represent you unless/until you have signed an Engagement Letter with our firm. You may contact us at 405-824-8565 or shannon@staylorlaw.com.
