These three basic estate planning instruments comprise the largest portion of estate planning documents drafted by attorneys for clients. They are, however, often augmented with additional instruments including joint tenancies, pay on death provisions, and/or real property deeds, which can include transfer on death deeds. In this article, we are focusing solely on the primary estate planning vehicle; i.e., the will. The will lies at the core of any estate planning scheme regardless of one’s intention and desire.
The Definition of Will
A will has been defined as a “revocable instrument by which a person makes disposition of his/her property to take effect after his/her death.” A will could be regarded as the single most important estate planning document. In the absence of a validly executed will, state law – and not your desires – will control the disposition of your property after your death.
Your will is not designed to avoid any estate, inheritance, income or other tax on your assets. The function of your will is to conduct the probate of those assets that are in your estate at the time of death in a manner that you desire and to provide designated guardians of your children. The will establishes whom you wish to be your personal representative and the powers they are given in administering your estate. It directs the manner in which taxes and expenses of your estate are paid.
Lastly, it directs the distribution of your estate. Certain assets, such as IRAs, retirement plan death benefits, life insurance policy proceeds and property held with rights of survivorship pass independently outside of probate and, therefore, are unaffected by the provisions of your will. There are numerous other estate planning vehicles and a multitude of variations of each, but the will is the core of your estate planning.
Know Your State’s Guidelines
This information in this article is specific to a will established in the state of Oklahoma. If you live in another state, please contact an estate attorney who can provide you with the guidelines established within your state of residence.
A will in Oklahoma must adhere to strict statutory guidelines. Oklahoma statutes generally provide for only two types of wills: a holographic will or a will drafted complying with certain requisites and requirements set forth in certain sections including Title 84 Oklahoma Statutes sections 55, 56, 853, and 854. Oklahoma recognizes a nuncupative will, or one done by a person in military service, but those will not be discussed in this article. Many would argue there is only one statutory will and that a holographic will or a nuncupative will are simply sub-categories or lesser types of wills.
The term holographic will creates confusion. The basic concept of a holographic will is that the terms are devised by the maker, the will is drafted entirely in the maker’s handwriting, and it is signed and dated by the maker. Essentially, the three dimensions, or holographic as the term implies, are all done exclusively by the maker.
Failure to adhere to strict statutory requirements will make a holographic will null and void. Even if statutory requirements are adhered to, failure to use proper or complete terminology in the disposition of your property can cause a holographic will to entirely or partially fail, sometimes resulting in the property going to someone other than the maker intended. Because of this, you can imagine, attorneys strongly discourage holographic wills and cringe at the sight of one. Many estate plannings have gone sideways due to the use of a holographic will by a well-intentioned individual.
The Structure of the Will
A will has some basic elements and sections or clauses that organize information in a specific order, generally as follow:
- Opening clauses: Lays out basic information about who you are and sets the stage for following clauses:
- Introductory clause identifies you as the person making the will;
- Family-statement clause introduces and identifies the family members who you will refer to later in the will; and
- Tax clause explains how the taxes of your estate will be paid.
- Beneficiaries: The individuals, group, or entity who will receive the property.
- Survival clause: This leaves everything in your estate to one named person. For example, married people do this to ensure that everything goes to the surviving spouse. Many times this also specifies that if your spouse is not alive at your death the property would be equally divided by your offspring.
- Giving clauses: These generally leave specific bequests, or property identified by name and description, to specific beneficiaries and explain what property goes to which person and under what circumstance. Specific clauses may be unnecessary if the survival clause catches everything. However, they may both be used.
- Real property clauses give real property or land to a specific person, such as giving your home to your sister or your farm to your son.
- Personal property clauses give personal property to a specific person, such as giving the family heirloom shotgun to your brother but the jewelry to your sister.
- Residuary clause: This leaves the balance of the estate, or everything remaining after the specific bequests, to beneficiaries. A residuary clause is essential for any will so that anything you forget or that is acquired after you write your will can be distributed.
- Appointment clause: This identifies the person who will manage your estate, also called the executor or Personal Representative.
- Executor: The individual who handles the property you are leaving behind. When you appoint this person in your Will, he/she is called a Personal Representative. If you die without a Will, the Court appoints an administrator, frequently a spouse or adult child, who will serve in the same capacity of handing all the paperwork, preparing assets, dealing with likely heirs, handling claims from creditors, making payments on outstanding debt, and other estate-related matters.
- Guardianship clause: This appoints a guardian for your minor children; a successor should also be named.
- Fiduciary powers clause: This language gives your executor the power to serve as your executor, including any duties that go beyond the basic requirements in Oklahoma law.
- Ending clauses: These include the legalities to meet statutory requirements so your will is legal and valid, such as your signature, date, witnesses and notary.
It’s Your Will
Your will can be as broad or as specific as you choose. However, you want to avoid being too broad and leaving the terms of your will ambiguous and subject to interpretation. Your witnesses cannot be anyone named in your will and should not be a relative or anyone with any bias toward your estate planning. You need to be competent and of sound mind when you create your will, as well as your witnesses. You should always consult an estate planning attorney to create your will in combination with other estate planning vehicles.
In 1990, Bart Bouse graduated from Northwestern Oklahoma State University with a degree in accounting. Bouse went on to receive his juris doctorate from the University of Oklahoma College of Law, and later began practicing general law at his firm, Bouse Law Firm.
Located in Woodward, Okla., Bouse Law Firm has been serving the state since 1999.
Bouse is a member of the Oklahoma Bar Association and is admitted to practice law in Oklahoma, the U.S. District Court-Western District of Oklahoma and the U.S. Court of Appeals-10th Circuit.