By G.W. Schulz
Why does planning your estate matter? An important reason is many people fear they will otherwise become a burden on loved ones left with the responsibility of an unplanned estate. “It is important to evaluate your goals and situation,” says Oklahoma State University about estate planning. “Then, discuss possible alternatives with an attorney who can help develop a plan that will meet your needs.”
“Probate” means the official execution of your will. Adds the Oklahoma Bar Association: “Someone is required to step into the shoes of the deceased person, so to speak,” says Oklahoma State University, “and carry out the business of the estate and pay the debts, taxes, and expenses, and, in the end, see that the property is distributed to the rightful parties in interest.”
Further: “Upon the death of a property owner, Oklahoma law provides for a legal process to take control of the deceased owner’s probate assets, assess their value, pay creditors, and distribute the assets to the person’s legatees (if the person died with a will) or heirs (if the person died without a will).”
Keep reading below to learn more.
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Below is a list created with help from OSU, the Congressional Budget Office, and the Oklahoma Bar Association of important things you’ll want to know about estate planning:
- What are your planning strategies? You’ll want to know how much it costs to settle the estate, which can be more important than minimizing estate taxes. Such state-settlement costs can include executor fees, accountant fees, appraisal fees, attorney’s fees, and probate court. What’s a trust? It’s simply a way of owning assets and then transferring them to someone else upon death. “Proper legal assistance is needed to establish the trust to ensure probate will be avoided,” says Oklahoma State University.
- Who will receive your assets? You’ll need to determine who you wish to exclude from your estate. Also, you’ll want to specifically name who would be getting certain of your assets. You’ll also want to take this time to identify charitable organizations you’d like to support. State-level estate taxes in Oklahoma were repealed by lawmakers in the past. But federal estate taxes may still apply to you.
- Who pays taxes on their estate? Only a small number of estates each year actually wind up paying estate and gift taxes. “In 2018, taxable estates reported $106 billion in gross assets,” according to the Congressional Budget Office. “Financial assets, which include stocks, bonds, and cash, made up the majority of those gross assets, totaling $64.6 billion.”
- What assets do you have? Here’s where we need to discuss the full spectrum of what you own or control. On this list, for example, would be real property and mineral and surface rights. A good attorney would ask: Are there restrictions on the asset transfers? Does the property have renters? Where did the property come from? Who holds the title to the asset? “When people die, their assets become the property of their estate. Everything a decedent owned or had a financial interest in at the time of death – from stocks and buildings, for example, to jewelry and artwork – is considered part of his or her estate,” the CBO writes.
What are your goals for an estate plan? Among other things, you may want to hold on to your business as long as you can. You might be seeking to continue a business or leave it to a family member. Or you could be worried about evenly treating your heirs. Maybe you’ll want to leave something to someone you love who has special needs. Maybe you simply want flexibility in your estate plan if changes occur in your life. Says the Oklahoma Bar Association: “The proper drafting of a will or a trust requires the professional knowledge, skill, and experience of a practicing lawyer. … A few hours of an attorney’s time now can save your beneficiaries not only the costs of litigation over a poorly drawn will or trust but also the additional expense of a guardianship of your minor children.”