Tools to Avoid Probate

1. Tools to Avoid Probate Carlson & Copeland, PLLC Attorney Patrick R. Carlson

2. We’ve Seen Probate… Are there any options that allow your heirs to avoid using probate to pass the majority of your estate?

3. Transfer on Death Deeds • A document, filed in the land records, that allows a property owner to designate a beneficiary to receive the property when the owner dies. • Very similar to payable on death (POD) bank accounts.

4. Transfer on Death Deeds Pros • Fairly easy to implement • Avoids your heirs or beneficiary’s creditors from seizing the asset during your life • Can be withdrawn and changed, if necessary • Fairly easy for beneficiary to obtain title after your death Cons • Requires filing of paperwork • Your beneficiary is public information • Not a complete solution • Provides no asset protection for beneficiaries • Not suitable if minors might inherit

5. Joint Tenancy • Form of ownership of property by two or more people where each person’s interest passes to the other joint owners when that person dies. • Real estate, bank accounts, cars, and other property can be owned in joint tenancy.

6. Joint Tenancy Pros • Fairly easy to set up • Fairly easy to gain title to property after death of a joint tenant • Common type of ownership so it’s understood by lenders and third parties Cons • Generally doesn’t avoid probate if both joint owners die in a common accident • A joint tenant’s interest can be seized by creditors to pay debts • Joint tenancy real estate is a matter of public record • Not suitable for minor beneficiaries

7. Trusts • A trust is a legal arrangement where a trustee holds title to property for the use and benefit of beneficiaries of the trust. • Common names are revocable trust, revocable living trust, and living trusts.

8. Trusts Pros • Usually revocable so it can be changed as necessary • Can provide for management of your property if you become incapacitated or disabled • Can contain estate tax and income tax planning • Usually less costly and faster than probate Cons • Requires “funding” to be effective • Trustees may serve for a long time, so: • Select a successor trustee you trust and is competent for long-term management of property • Corporate trustees are an option but can be expensive

9. An Example Living Trust John Client Property / Money to Fund the Trust John Client Trust Other Trusts Specific Gifts Life Insurance Proceeds & Other “Beneficiary” Proceeds Additional Property / Money Income from Property Use of Property John Client, Jr. Jane Client Marital Trust Trust for Grandchildren John Client Estate (Pour-Over Will)

10. Ending Notes This was a general discussion of some of the estate planning tools that can be used to avoid probate. It was not a discussion of any specific situation nor an endorsement of a particular strategy in any given situation. You should only take action or implement an estate planning strategy after consulting a qualified attorney who can tailor the solution to your needs and family.

11. Questions? • Call (405) 701-1994 • Visit our websites & read our blog: • www.carlsoncopelandlaw.com • www.oklahoma-estate-planning.com