Oklahoma Estate Planning

Oklahoma Estate Planning is about taking care of your family. The tools we use for Oklahoma Estate Planning are Trusts, Wills, Durable Power of Attorney, Living Wills and many other things.

An explanation of Federal Estate Taxes in plain English [Part II]

In Part I of this series, I started by talking about the basics of Federal Estate taxation, including the estate, market value of property and moving target that is the exemption amount. Today, we are going to answer more specific questions about how much you could owe and how you might be able to minimize what you owe.
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Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning

An explanation of Federal Estate Taxes in plain English [Part I]

The goal of this series is to help you understand when you might want to plan to minimize Federal estate taxes. You need to understand what the IRS considers your “gross estate”, “fair market value”, when you could owe federal estate taxes and what you can do to minimize the amount of taxes you would pay if any are owed.

What is your “Estate”?
The “Estate” consists of everything you own or have an interest in at the time you die. The fair market value of these items is used, not necessarily what you paid for them or what their values were when you acquired them. The total of all of these items is your “Gross Estate.” It is the value of your “gross estate” on which you will be taxed.

The property may include a lot of different things like cash and securities, real estate, insurance, trusts, annuities, business interests and other assets. You may have heard about the distinction between “probate” (property that the Court has control over) and “non-probate” property (property that passes outside of the court process). Forget that distinction for federal estate tax purposes, the IRS looks at everything and this usually means non-probate as well as probate property.

What is “Fair Market Value?”
Fair Market Value is generally the price at which the property would sell if two normal people were doing a transaction that didn’t involve any really unusual circumstances. For example, the IRS says that fair market value can’t be a “forced sale price”, something like the price for property at a foreclosure sale. Essentially, fair market value comes down to what someone would sell an item for on Craigslist to a buyer that understood what he was buying and was willing to pay for it.

Who is going to owe Federal Estate Taxes?
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Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning

A diagram of the documents used in Oklahoma estate planning

From time to time on here, I talk about the basics of Oklahoma estate planning, such as in this podcast or this series on Oklahoma Estate Planning Myths as well as a few others. Today, my idea is to provide a visual representation of many of the documents you can expect to see when you working with a living trust. To do this, I created a diagram (it also functions as a checklist and guide in my office) of the key documents, with a brief description of each document. If you would like a larger and potentially higher quality image, you can click on the image and go to Flickr where it is hosted.

Generic Estate Planning Document Outline3

Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning

Oklahoma Estate Planning Myths

 

A widely held but false belief or idea.  –  Myth

My goal in this series of posts is to challenge and hopefully dispel some of the myths about Oklahoma Estate Planning. Hopefully, these posts give you some ideas on things you need to do or be thinking about.

Oklahoma Estate Planning Myths: A will covers disposition of all your assets

Oklahoma Estate Planning Myths: Having a Will avoids Oklahoma probate

Oklahoma Estate Planning Myth: If I have a Trust, I do not need a Will.

Oklahoma Estate Planning Myths: If I die without a will, all my assets go to the government.

Oklahoma Estate Planning Myths: I can do my own estate plan

Oklahoma Estate Planning Myths: Estate Planning is only for the wealthy

Oklahoma Estate Planning Myths: I am too young for an estate plan

Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning, Oklahoma Probate

Oklahoma Estate Planning Myths: A will covers transfer of all your assets

From the series Oklahoma Planning Myths . . .

MYTH: A will covers disposition of all your assets.

FACT: A will only covers property titled in your name alone at your time of death. Property such as jointly held assets, retirement plans, and life insurance will pass to the surviving owner or designated beneficiary.

In planning, be certain that you have the property that will not pass under your Last Will and Testament set up to go where you want it to go.

For other information on estate planning, including a podcast called “Estate Planning Demystified” check out my Oklahoma Estate Planning page.

This material was adapted from the firm Tellie Coleman, attorneys at law. Tellie & Coleman has an excellent website with some great resource material.

Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning, Oklahoma Probate

Oklahoma Estate Planning Myths: Having a Will avoids Oklahoma probate

From the series Oklahoma Planning Myths . . .

MYTH: Having a will avoids probate.

FACT:  A Last Will and Testament does not do anything to avoid a probate case when the property at issue is real property.  A Will is the written expression of a person’s desires for how their property will be passed on following the person’s death.  A Will cannot however change title to real property.  Here is an example.

Mr. Tronald Dump passes away, without a spouse and as the owner of his home.  The real property records show that Mr. Dump is the sole owner of the home.  For legal title that Mr. Dump’s home to change to his heirs, a probate court will have enter an order changing title.

But, you say “Mr. Dump left a valid Lat Will and Testament that directs the home to his nephew?  Why isn’t that enough?”  The answer is that Mr. Trump’s Will directs the probate court on who to transfer title to the property to but Will itself doesn’t change title to the property.  For that reason, Mr. Dump’s nephew will have to file a probate case and ask the probate court to issue an order changing title from Mr. Dump to the nephew.

Probate proceedings must take place to transfer ownership of real estate, to appoint a guardian for minor children, and to appoint an administrator. If the Will is valid and uncontested, the court monitors administration of the will to ensure the decedent’s wishes are followed accurately and in a timely fashion. There is some cost involved, but not a tremendous amount.

A living trust, if properly executed and funded, is the Oklahoma estate planning tool that could help you avoid probate.

For other information on estate planning, including a podcast called “Estate Planning Demystified” check out my Oklahoma Estate Planning page.

 

Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning, Oklahoma Probate

Oklahoma Estate Planning Myths: I can do my own estate plan

From the series Oklahoma Planning Myths . . .

MYTH: I can do my own estate plan.

FACT: I wouldn’t advise it and I give a compelling example of why in this post.
Many do-it-yourself software programs (many found online) allow you to create your own documents. However, estate planning is more than just creating a form document. You cannot create an effective document without understanding how it will work at the time it is needed most. Trusts drafted and administered through internet forms are a leading cause of trust and probate litigation. Money spent securing good documents now will save your family a significant amount of money in the future. Finally, every family should work to develop a long term relationship with a local attorney. You never know when you may need legal services of one kind or another and your family attorney can frequently help you or can refer you to another reputable attorney.

For other information on estate planning, including a podcast called “Estate Planning Demystified” check out my Oklahoma Estate Planning page.

This material was adapted from the firm Tellie Coleman, attorneys at law. Tellie & Coleman has an excellent website with some great resource material.

Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning, Oklahoma Probate

Oklahoma Estate Planning Myths: Estate Planning is only for the wealthy

From the series Oklahoma Planning Myths . . .

MYTH: Estate Planning is only for the wealthy

FACT: Many factors other than wealth affect the need for estate planning, such as:

(1) caring for a minor or disabled child;
(2) transferring ownership of property in accordance with your desires;
(3) caring for a surviving spouse;
(4) transferring closely held business interests
(5) transferring ownership of property in another state;
(6) charitable giving;
(7) avoiding probate; and
(8) avoiding taxes.

Regardless of what or how much you have, an estate plan is simply a set of directions for the distribution of your assets and protection of your family when you become incapacitated or pass away.

For other information on estate planning, including a podcast called “Estate Planning Demystified” check out my Oklahoma Estate Planning page.

This material was adapted from the firm Tellie Coleman, attorneys at law. Tellie & Coleman has an excellent website with some great resource material.

Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning, Oklahoma Probate

Oklahoma Estate Planning Myths: I am too young for an estate plan

From the series Oklahoma Planning Myths . . .

MYTH: I am too young for an estate plan.

FACT: This is only true if everyone knew the exact time when they would die or become incapacitated. In an estate plan, you make decisions that protect your family regardless of your age:

1. Everyone needs to have a health care power of attorney in place to enable someone to make health care decisions for them in the event they become incapacitated, as well as financial decisions. This is almost purely an action you take for your family because it will be your family members who are faced with the tough decisions if you are incapacitated and unable to make the decisions.

2. You can nominate the guardians for your minor children to ensure that the people you want to care for your children are most likely to be appointed as guardians.

3. You can choose the people that will administer your estate.

4. You can decide how to transfer your property so as to best protect your family.

For other information on estate planning, including a podcast called “Estate Planning Demystified” check out my Oklahoma Estate Planning page.

Posted by Shawn Roberts in Blogposts, Oklahoma Estate Planning, Oklahoma Probate