Tulsa Wills, Trusts and Probate LawyerHow Beneficiary Designations Affect Asset Distribution in Oklahoma

beneficiary designationsMost people assume that when they die, all of their property will be included in their estate to be distributed according to the terms of their will. However, there are some circumstances where property will pass directly to another person outside of the probate process (i.e. beneficiary designations). In fact, if a person in Oklahoma wanted to avoid probate altogether, there are ways to do this with the use of beneficiary designations; however, some of the ways are risky and have disadvantages that may outweigh avoiding probate.

Tulsa Estate Planning Attorney Jason M. Lile and the skilled attorneys at Oklahoma Will & Trust are ready to help you with all of your estate planning needs and beneficiary designations. We will help you develop a strategy that will ensure your final wishes are carried out after your death.

Beneficiary designations in Oklahoma, joint tenancy and pay-on-death designations are three examples of how property can pass directly to a beneficiary outside of your estate. If these situations apply, the property does not go through probate. Giving property to beneficiaries prior to your death is another way some people attempt to avoid probate in Oklahoma; however, this is very risky and has many disadvantages. Before you decide how to title property or before you designate beneficiaries, you should discuss these options and your estate planning needs with a qualified Tulsa estate planning attorney.

Types of Beneficiary Designations in Oklahoma

  • Contractually-Named Beneficiaries – Most people think about life insurance policies when they think of naming beneficiaries. In fact, life insurance is the most common type of asset that utilizes contractual beneficiaries. However, there are other types of accounts where you may be able to utilize a contractual beneficiary. Other types of assets where you can designate a beneficiary, including Individual Retirement Accounts (IRAs), retirement plans (i.e. 401(k), 403(b) and 457 plans), pension plans, employee stock ownership plans (ESOPs), annuities and stock options. If you designate a specific beneficiary, other than your estate, the funds or account will be transferred to the beneficiary upon your death. These assets would not be probated since they are paid directly to the beneficiary.
  • Joint Tenancy – This is a form of ownership that some people refer to as a “poor man’s will.” Joint tenancy is referred to as a poor man’s will because, upon the death of the first owner, the property automatically transfers to the surviving owner without the need for probate. However, if both owners die simultaneously, the property would then enter the probate estate of the person who was deemed to have died last. Even though this may sound like a great way to avoid bankruptcy, joint tenancy means that the property is subject to both owners’ creditors during their lifetimes and it can create tax problems for the surviving owner. Before deciding if joint tenancy is the right estate-planning strategy for you, you should talk to an experienced Tulsa probate attorney at Oklahoma Will & Trust.
  • Pay-On-Death Designations – This is a very simple and effective way to ensure that a specific account is transferred to the person you want to have the account after your death. By executing documents at your bank or financial institution, you can designate a person who will receive the account or investment upon your death. As with joint tenancy, if the beneficiary dies with you or predeceases you, then the asset will be subject to probate.
  • Title Property In The Beneficiary’s Name – This is a very risky way to avoid probate that not many experienced estate attorneys would advise. In these types of beneficiary designations, you are basically giving away your property by titling it in the name of the beneficiary. At the time of transfer, you no longer own an interest in the property and it would not be subject to probate upon your death. However, the property now belongs to the beneficiary and he or she may keep it, sell it, mortgage it, give it away, etc. The property also becomes subject to the beneficiary’s creditors and other financial or legal problems. Please see the advice of an estate planning attorney before you choose this option to avoid costly mistakes that may not be able to be undone.

Contact an Experienced Estate Planning Attorney in Tulsa to Discuss Beneficiary Designations in Oklahoma

When you need the services of an experienced estate planning attorney, call Oklahoma Will & Trust. Tulsa Estate Attorney Jason M. Lile has the experience and knowledge to assist you with all of your estate planning and probate needs, including Oklahoma beneficiary designations. As a skilled Tulsa estate planning attorney, Jason M. Lile knows the advantages of protecting your estate and ensuring that your wishes are followed.

Contact an experienced Tulsa estate planning attorney today for a free consultation about the best approach to protecting your legacy. Call (918) 876-4500 to schedule your free consultation. We are conveniently located at 500 W. 7th St., Suite 104 in Tulsa, OK.


Bookmark and Share