Estate Planning

Think Twice About Adding a Beneficiary to Your Deed

One of the critical reasons to engage in estate planning is that the upfront costs to establish the proper estate planning strategies often cost much less than the trouble that can arise if a person does not create a proper plan. One of the most costly types of estate planning errors involves the methods that a person utilizes to convey property to loved ones following death or incapacity.    A unique challenge presented by many individuals currently engaged in the estate planning process is that they have been in their “home” or property for many years, during which time the worth of the estate has increased substantially. Consequently, a transfer of the property creates long term gain complications, which means that listing a beneficiary on a property deed is often not the best type of estate planning strategy.    The Challenge Presented by Listing Beneficiaries   Most people list beneficiaries on various estate planning documents including life insurance policies, retirement accounts, and trusts. Consequently, these individuals often make the mistake of thinking that it will present little harm to name a beneficiary on a deed. Even if a person is aware of the risk presented by transferring property in this     Read More

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Deciding Inheritance Issues for Agricultural Property

In many parts of Oklahoma, landowners must answer questions about how agricultural land must pass to loved ones after the owner’s death or incapacity. Questions about how estates can be passed on and what parties who do not inherit ownership of land will receive are common in such cases. Understandably, many Oklahoma agriculture and farm owners discover that it is more difficult to decide how to transfer this property than it is other types of land.   Emotional Connection to Land   For the owners of non-agricultural land, the transfer of property at the end of life is generally a non-emotional process. Most agricultural landowners, however, have a deep connection to the land. Many of these owners recall the process of having to buy out siblings as well as the earlier generation. As a result, while decisions can often be made more quickly and unemotionally for other landowners, this just is not so for the majority of farm owners.   Operation Versus Land Uses   When a person refers to a “farm,” this often includes both the operation of the land as well as the underlying land. Transferring a farm is unique because often the land is transferred differently than     Read More

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The Value of Letters of Instruction

Wills play a critical part in most estate plans, but they should be supported by other critical estate planning documents. These include letters of instruction, which play an important role in making sure that your loved ones know how to handle your estate following your death or incapacity. The following will review the role that letters of instruction can play in estate planning.   The Basic Elements   The content of letters of instruction varies greatly based on a person’s goals. One of the primary purposes of these documents is to provide details about a person’s wishes that have not yet been fully addressed in other estate planning documents.   In addition to addressing how you would like aspects of your funeral or burial handled, these letters can also address critical financial information that has been omitted. Many people rely on letters of instruction to list what insurance policies, retirement accounts, and other types of financial accounts they own.   Letters of instructions do more, however than just list financial accounts. These documents can contain account numbers as well as details about where important documents are stored. Many letters of instruction also contain the passwords required to access electronic financial     Read More

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Estate Planning Opportunities Presented by the Coronavirus Pandemic

It would be an understatement to say that our lives have changed as the result of the coronavirus pandemic and its impact on the economy. While many people are facing hardships as they plan for what lies ahead, these difficult times have presented some powerful estate planning strategies. This article reviews some unique opportunities presented by the pandemic that can let you make the most of estate and gift taxes.  Grantor Retained Annuity Trusts These trusts are an ideal way to transfer assets that will appreciate in the future to children without facing transfer taxes. As part of these trusts, an individual transfers interests or securities to an irrevocable trust. Following this transfer, a person still has the right to receive trust annual annuity payments. Because the trust creator retains the full value of the transferred property, a gift is often considered to be made that would be subject to a gift tax.  For these trusts to transfer appreciation in the assets to a person’s children or beneficiaries, the rate of return must be greater than 7250 times the rate as of the date that the trust is created. The greater the return, the more appreciation that can be transferred.     Read More

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What is Form 709 and Why Would I Need it?

Given that the lifetime gas tax exemption for 2020 has been increased for the next year to $11.58 million, a much smaller portion of people is now subject to federal gift taxes. Many people are also wondering whether it is still necessary to file gift tax returns.  While it is not necessary to file these forms if your assets are below this threshold, there are situations in which you might want to file a Form 709, which is also known as a “United States Gift Tax Return.” This article reviews some critical details that you understand about the role of Form 709. What Does Not Require a Form 709 While many asset transfers constitute gifts, there are some notable exceptions. Some asset transfers that need not be reported on Form 709 include: Direct payments for qualifying medical or educational expenses. Deductible charitable gifts. Gifts of present interests within the annual exclusion amount. Gifts to a spouse who is a U.S. citizen either directly or through a qualifying trust Gifts to a noncitizen spouse within an annual exclusion amount of $157,000 Transfers in these categories are not subject to a gift tax return. All other gifts, however, must be reported through     Read More

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Four Critical Estate Planning Strategies for Difficult Times

The coronavirus pandemic has left many people curious about what estate planning strategy works. You also might have discovered that some estate planning strategies you once planned on utilizing are no longer the best choice. These difficult times also hopefully prompt people who have not yet engaged in estate planning to create strategies for unexpected incapacity or death, there are also some critical steps that you can take if you already have an estate plan to make sure that you are fully prepared for the future. Review the Terms of Existing Documents To make sure that your estate plan is still capable of achieving your goals, it is critical to review its essential terms. While looking over your estate plan, make sure to ask yourself the important questions: Are the people you designated as personal representatives still the best selections? Have births, deaths, divorce, or marriage impacted your intended beneficiaries? Is the amount that each beneficiary receives as a distribution still appropriate? Are your health care choices still appropriately reflected in your directives? Are the terms of your durable power of attorney still appropriate? Do your loved ones know where to find your estate planning documents? If you decide that     Read More

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Estate Planning Advice During the Coronavirus Pandemic

As Oklahoma begins to loosen its coronavirus restrictions, many people, including those with children, are wondering what they can do to make sure they are adequately prepared if they contract COVID-19 and are left incapacitated. Two substantial issues that parents worry about is who will make financial and medical decisions for them if they are not able to make them for themselves as well as who will take care of their children in case they are left unable to do so.  If you are left incapacitated as a result of the coronavirus or any other condition, your loved ones will need to go court to have a guardian appointed. This was a costly and time-consuming process before the pandemic, and now it is even more challenging. Consequently, it is best to prepare in advance and make sure that you have created several critical estate planning documents that address incapacity. Durable Power of Attorney These documents appoint an agent to help address your financial affairs if you are incapacitated. Rather than wait for the court to appoint a conservatory, an agent appointed through a durable power of attorney has instant access to your financial accounts and can sign your name on     Read More

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Advice on Turning Your Retirement Plan Into an Estate Plan

Due to the coronavirus pandemic, the country has understandably seen an increase in the number of people creating estate plans. If you feel the need to quickly create or revise the terms of your estate plan, there are easy changes that can be made to turn a retirement plan into a strategy to handle your death or incapacity. Create a Will If you have not yet created a will, it can be challenging to make sure that your will meets all requirements during stay at home restrictions. Oklahoma does not require you to notarize your will to make it legal, but if you want to create a "self-proving" will then you will need to notarize the document.  Wills that are "self-proving" proceed through the probate much more quickly because a court can accept the document without contacting witnesses. It can be challenging to notarize documents during the pandemic, even if you utilize creative methods like self-notarization. Fortunately, a knowledgeable estate planning attorney can make sure that your will is properly written as well as adequately executed and attested. Create a Power of Attorney Power of attorney documents allow a person to designate an individual to act on their behalf if     Read More

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Recognizing When it is Time to Update Your Estate Plan

Creating an estate plan is one of the most powerful ways to leave a lasting reminder of your love for family and friends. Unfortunately, the best estate plans are not written in stone. Instead, your estate planning strategies should grow and change based on various evolving life situations.  As we weather the coronavirus pandemic and as we overcome countless challenges, it is important to make sure that your estate plan considers life changes. This article reviews four events that should cause you to review the terms of your estate plan. Divorce and Marriage Whether you just entered into a marriage or recently ended one, it is important to consider the relationship that current or former spouses have to estate plans. If you are entering into a new marriage, you likely want to make sure that your spouse is written into your estate plan in a way that most greatly minimizes tax issues.  Conversely, if you are ending a marriage, you likely want to make sure that your ex is properly excluded from your estate plan, which includes making sure that your ex is left out of any assets that pass through beneficiary designations. The Death of a Loved One Losing     Read More

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Estate Planning During a Pandemic

While many of us will follow adequate safety protocols and avoid coronavirus, some people will contract COVID-19 and will ultimately not survive. To prepare for any path that lies ahead, it is a good idea to plan for the chance of incapacity or death through various estate planning documents including wills, powers of attorney, and other vital documents.  While it is easy to delay estate planning because it requires confronting uncomfortable realities, now is the time to engage in planning for whatever may lie ahead. Remember that even if you feel your assets are not substantial enough, having an estate plan is still critical.  The following will review some critical details to remember about the estate planning process.  Signings are Still Possible During Self-Isolation With most people throughout the country currently practicing self-isolation measures, one of the most critical steps in completing any type of advance directive is locating witnesses for estate plans.  Some people have begun utilizing creative efforts to satisfy this witness requirement including having neighbors watching the signing of estate plans from a distance. People have also participated in “drive-by signings,” during which a person waits inside a vehicle with the windows rolled down as law firm     Read More

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