You may have heard the term “small estate”, and you wonder: What is a small estate in Oklahoma?
If a person owned a small estate, then, after the owner of the small estate dies, it will be easier for the owner’s heirs will be able to transfer property owned by the estate, or collect debts owed to the estate. The heirs will need only to fill out an affidavit; the heirs will not have to go through probate.
Under Oklahoma state law, a small estate, is an estate where “The fair market value of property located in this state owned by the decedent and subject to disposition by will or intestate succession at the time of the decedent's death, less liens and encumbrances, does not exceed Fifty Thousand Dollars ($50,000.00)”
Let’s break down that definition:
Fair market value – according to Black’s Law Dictionary, fair market value is a value that a seller will accept and that a buyer will pay.
Located in this state – if all of the property that the decedent owns, located in this state, is of a total value less than $50,000, it’s a small estate. If the decedent owns property outside of Oklahoma, this out-of-state property does not count in determining whether an estate is a small estate.
Owned by the decedent – Does the decedent actually own the property? Or is some of the property owned by a trust? If the property is owned by a trust, (even if the decedent was the sole beneficiary during his lifetime), then the decedent is not the owner of the property. When calculating whether you have a small estate, only include the property in the decedent’s name.
Subject to disposition by will or intestate succession at the time of decedent’s death – Some property can be disposed by will or intestate succession when the decedent dies. Other property can be disposed other ways – for example, by joint tenancy, transfer on death deed, contractual arrangements, retirement or insurance benefits, trusts, etc. To see a list of common ways property may distributed by other ways than by will or intestate succession, click here. If the decedent owned property that may be transferred in ways other than by will or intestate succession, then don’t include this property when calculating whether the decedent owned a small estate.
Less liens and encumbrances – If there are any liens and encumbrances, subtract these when determining the value of the estate.
Some of these factors are complicated to determine. If you are still unsure as to whether your relative had a “small estate”, consult a qualified estate attorney.
After making all of these calculations, if the total value of the property is less than $50,000, then, there is a small estate.
If the decedent owned a small estate, you may collect debts or transfer property to yourself if you are the “successor” of the decedent. If there is more than one successor, then you will have to divide the debts and property among the successors.
How do I find out if I am the successor?
If the decedent had a will, the successor is the person named in the will as the person who would receive the property. If the decedent had no will, then look at the Oklahoma Intestate Succession Law to see who the successor is.
What can I do if I am the successor to a “small estate”?
To collect a debt owed to a small estate, or to transfer property owned by a small estate, fill out a small estate affidavit. I’ve included small estate affidavit forms, for various types of property, here.
Probating a small estate
There still may be certain circumstances where you need to go to probate court to distribute a small estate. Oklahoma law allows for a simple, less time-consuming, type of probate, called “summary administration”, when an estate is worth less than $200,000. In next week’s post, I’ll explain summary administration.