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Avoiding the Terri Schaivo Case – The Oklahoma Advance Directive

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Avoiding the Terri Schaivo Case – The Oklahoma Advance Directive

???????????????????????????????????????????????One of the most prominent cases of Living Wills or Advance Directives was the Terri Schaivo case in the early 2000s. It is prominent for Living Wills, in that Terri Schaivo did not have one, and her situation caused a legal battle that lasted years and costed thousands of dollars for her family.

In this case, there was a emotional and nationally-known legal battle in Florida over whether a woman, Terri Schaivo, would be kept alive through treatment of artificial food and water, or would pass away from the disuse of the treatment.  If you remember, her husband, who was still legally married to her but estranged from her family, wanted her to pass away, but her family wanted her to remain alive through the artificial means.  Since Terri Schaivo did not have a Living Will that told her family and husband what her wishes were, her family and spouse went through ten years of litigation, one-hundred thousand ($100,000) of dollars in legal fees, and endless pain and frustration for everyone involved.  A Florida court ultimately decided Ms. Schaivo should be allowed to pass away.

Terri Schaivo and her family could have avoided the entire situation if she had a Living Will or Advance Directive in place. Our attorney highly recommends this document since it takes the heart-breaking and agonizing decision away from your family members, and allows you to get your end-of-life wishes. In Oklahoma, there are three situations that the state allows you  to make your end-of-life wishes known. See our previous post about those specific situations here. This document is inexpensive, easy to execute, and could save you and your family money, emotional stress, and it grants you all peace of mind.

If you already have a Living Will in place, see if you need to update it by reading a previous post here.

Call the office of The Skillern Law Firm, PLLC today to schedule a meeting to discuss this document as well as other your other estate planning needs today!

Important Considerations for Business Co-Founders to Consider

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New  businesses, or start-ups, often struggle later on its the business’s life due to how the business was originally set up or organized. This is more often a problem with businesses with more than one founder, since at one point or another, personalities and ideas will clash between the founders or later buy-ins. Too often, business co-founders will treat a new company like an exciting new relationship. The founders get excited about the new business, everyone seems to agree on everything, and then the business is founded without talking to an attorney, accountant, or any other business professional. The founders go out, start the business, and never discuss operating agreements, by-laws, or anything else that a professional would suggest. In the professional world, relationships that start in a frenzy, and without much consideration for the future, often end up in failure, and start-ups are no different.

First, before even consulting an attorney and/or accountant, it is very important for the co-founders to have a long and detailed conversations about their business, their working relationship, how to settle disputes in the future,and many other topics that they will have to deal with as the company grows. 

One of the people who knows this best is Dharmesh Shah, the successful entrepreneur and co-founder of HubSpot.  He recently published a list of the most important questions that co-founders need to resolve as soon as possible when starting a new business. 

 

After you talk to the other founders of the business, it is time for the business owners to consult an attorney and/or CPA. Every business and business owner is different, so a meeting with an attorney is important to discuss how to organize your business to fit your business present and future needs.. If you are in the process of starting a business, or have recently started one one (or never got around to creating an operating agreement), please call our office today for a free consultation about the needs to organize your business. 

If you are thinking about starting a business, these previous posts may interest you:

– Commingling of Business & Personal Funds (And Why It Is A Bad Idea

What is a Limited Liability Company?

What is a S Corporation?

Should I Get A More Complex Estate Plan?

Most people that come into our office expect to need a “simple” estate plan. Usually, they mean a will, power of attorneys, and a living will. No trust, no tax planning, and no trust provisions for their children or other family members.  Perhaps the initial motivator for this is the lower cost, but also the understandable desire to avoid taking the time and energy to understand the workings of a more complex estate plan.

First of all, of course simple plans are less expensive and easier to understand. However simple estate plans are usually for small, straight forward estates. Small usually meaning an entire estate worth less than 100-150 thousand, and straightforward meaning married couple with adult, healthy children with no complications. Most couples estates are worth more than the smaller, especially when you consider that your estate consists of EVERYTHING you own (Life insurance, real property/homes, cars, personal property, retirement accounts, bank accounts, etc. Also, if you have children, grandchildren, or others that you care about and wish to see benefit from your estate, a simple plan offers absolutely no assurance that that will happen.

Here’s a couple of brief examples:

  1. John dies and leaves all of his assets to his wife Jessica. They have one child, Joe.  A few years later, Jessica marries Jack, and they buy a house together with Jessica’s money, and she names Jack as the beneficiary of the IRA that she rolled over from John.  Jessica then dies, with a Will that names Joe as the sole beneficiary.  However, despite what the Will says, her second husband Jack gets the house, the IRA, and under Oklahoma law, one-half of all other property.  John and Jane’s son, Joe, is left with little of her estate.
  2. Lisse has three adult children, Larry, Louise, and Lisa.  Louise and Lonnie each have two children of their own. Lisse’s Will provides that each shall receive one-third of the estate.  Lisse dies, and each child receives $250,000.  Larry uses the money to buy a home with his wife.  They then divorce, and the judge awards her the house in the divorce settlement.  He is left with nothing of Lisse’s original estate.  Louise uses the money to start a business, risky since she has little business sense or experience.  The business fails, and she and her children are left with nothing. Lisa puts the money in a savings account in his name, but his Will provides that her husband gets everything.  Lisa dies, and a couple of years later her husband remarries.  Sometime after that he dies, and the new wife gets everything, and leaves nothing for Lisa’s children. After all of these events, Lisse’s children and grandchildren are left with nothing of the original estate.

These types of circumstances occur everyday and impact many, many families. Second marriages are very common, and as a consequence, children and grandchildren are unintentionally disinherited, and in-laws, spouses or ex-spouses, and creditors end up with the family legacy.

How do you prevent these types of things from happening? Call our office today about using a trust or multiple trusts as part of your overall estate plan.  It will cost a bit more (at this time, but do not forget it skips probate costs), and take some more time to implement, but the savings and peace of mind can be priceless.

How to Handle Titled Transportation Vehicles to Skip Probate

car picMost people know how to put beneficiary designations on their accounts to skip that asset from going to probate. Most of the time, it is a one or two page form that the financial institution provides you. (See more about that at our post about Beneficiary Designations). However, one type of asset that is often left behind is an automobile, boat, or any other titled vehicle. One particularly useful procedure that Oklahoma allows in these cases is the “No Administrator Affidavit” that is available from the Motor Vehicle Division of the Oklahoma Tax Commission through tag agencies  in cities across Oklahoma. You can complete this form and attach a certified copy of the death certificate, and then the affiant (person who signed the affidavit) may obtain title to a vehicle, boat or outboard motor where there is no probate or administration proceeding and no other person would have a prior right.

If your estate is not large enough to justify paying for a Revocable Trust, you should look into how to set up your estate in a way that would make probate less strenuous on your family, or skip it all-together.

If you would like to know more about how to do this, or if you need to set up a Revocable Living Trust, please call the office of The Skillern Law Firm, PLLC today at (918) 805-2511.

What does the Fiscal Cliff Agreement mean for my estate?

What does the fiscal cliff agreement mean for my estate? The estate tax was a bit of a mixed bag – the $5 million dollar per person exemption was kept in place (and indexed for inflation continued) however the top rate is increased from 35% to 40% – effective yesterday. Other good news for estate planning – portability is kept in place and estate and gift remains unified – ie the $5 million stays in place for gift tax purposes as well. All are permanent law, so rejoice!

So, no real change for smaller estates worth under 5 million, however, if your estate is worth more than 5-10 million, the estate tax percentage increased.

Hope this helps! Please call the office of Skillern Law Firm if you have any questions or are ready to set up a trust or create a will.

It’s Important to Update your Estate Planning After A Divorce

Most couples, especially married couples, get their estate planning done together and draft them accordingly. Most of the time, married couples will get a Family Trust, rather than two individual Trusts, and all the beneficiaries/executors/trustees are listed as each other. After the unfortunate event of a divorce, it is extremely important to get your estate planning updated to reflect your life change. Most people’s wishes and ideas about who should receive and manage your property after your death changes after a divorce. The only way to effectively express that intent is to have a new estate plan drafted.

When you get divorced, you absolutely need to update your estate plan. Oklahoma law provides some safeguards for Wills, Trusts, and certain beneficiary designations. Under Oklahoma law, your former spouse does not benefit under your will or Trust, only if your Will or Trust follow the requirements of Oklahoma law. However, these few safeguards are incomplete and will not change your estate plan to exclude your ex-spouse in some situations. The default rule will not revoke any gifts to relatives of your ex-spouse, for example.

It is important to update your Will and/or Trust after a divorce, because the default Oklahoma rules that may or may not apply, and an experienced estate planning attorney will know which ones need updating. One of the best ways to express your new wishes after the divorce is to create or amend your estate plan. This way, you are able to accurately express your new intent with your estate, since divorce usually changes your intent (i.e. leaving the ex-spouse out), and this will ensure that your wishes are clearly communicated.

One important thing to update after a divorce is beneficiary designations on accounts. When you select beneficiaries for life insurance, retirement plans, or bank accounts, you are making a legally significant decision. After you pass away, the institution holding the account will look at your account information, including the death beneficiary, and distribute accordingly. Ex-spouses, if not changed on the account, have a strong chance of benefiting from the account.  Divorce has an very limited effect, if any, on these beneficiary type arrangements.

For example, most people hold a lot of assets in their IRA, 401(k), or other retirement plan. Most people do not realize that these retirement plans are governed by Federal law, and no state (including Oklahoma) can use a divorce decree/order to overcome the beneficiary designation on your retirement plan. This means your ex-spouse will benefit if the beneficiary is not changed. You absolutely have to change the beneficiaries after a divorce decree is final to express your new intent.

Most people have many other things on their minds if they have just gone through a divorce, but it is very important to contact an estate planning attorney, or be active in keeping your estate plan up-to-date. Please contact the Skillern Law Firm, PLLC if you need your estate plan updated or created.

Holiday Open House

Plan on attending the Skillern Law Firm’s Holiday Open House. NO RSVP required. Food and refreshments provided. If you would like to discuss your estate planning needs, or just come for some good conversation, feel free to attend!

 

 

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