Would it be legal to have my mineral deed be in mine and my hubby’s name as jointly with rights of survivorship along with payable upon death to and list my three children’s names, to eliminate probate?
I did a " Transfer on Death Deed" for minerals in new mexico & oklahoma. This makes probate not necessary.
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You need to make sure that any deed complies with the requirements of the state where the minerals are located. The concept is for an adult to be able to transfer a property to another adult. It may be that if you have a joint right of survivorship, then your husband would inherit and have the right to do as he pleases with the minerals and you cannot bind him to transfer to your children as that is more like a trust. You should consult an attorney about how to accomplish your goals.
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It is Oklahoma minerals.
Thanks for replying
Two items involved here:
- Deed to selves as JTWS
- TODD for the children. The survivor can always alter the TODD prior to 2nd death. Also, TODD may not have intended consequences if a child predeceases or become disabled, …You might want to consider a mineral trust as a better probate avoiding alternative.
This is not legal or tax advice. No attorney/client relationship created by this post.
I would just deed half to your husband, then both of you deed the interest to your children save and excepting a life estate with the right of survivorship.
Agree with TennisDaze if the minerals are located in Texas.
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My experience is that Oklahoma does NOT recognize a trust so it depends a lot on your state. Here in CA a trust works but our minerals were in OK so we had to go through probate a couple of times, grandparent and parents. A simple probate is not that bad but it is VERY IMPORTANT that an attorney well versed in minerals is used.
Reserving a life estate may hamper the ability to lease and/or accept a pooling order bonus. While crafty drafting of a life estate is possible, the costs to create a bullet-proof life estate reservation outweigh a trust.
This post is not legal or tax advice. No attorney-client relationship is based upon this post.
A trust in Oklahoma is recognized, the problem is that most people neglect to create and record a deed to place the minerals in a trust. For members with trusts, visit with an attorney in the state where the minerals are located to ensure that the trust is “properly funded”.
This post is not legal or tax advice. No attorney-client relationship is based upon this post.
Thanks so much for the replies, you have given me a lot to consider.
Set up a Living Trust if you are in Texas, and have your Will also specify who gets what. This is what my late parents did and we did not have to go through probate.
In fact, the mineral companies simply pulled up the Trust documents and Wills, and immediately transferred the rights to my brother and me.
Be sure the Will has a provision preventing any future spouses from inheriting the rights. We put that into the Wills, and although not necessary, it prevented a lot of red tape and legal arguments after another man snatched up my Alzheimer’s ridden mother after my father’s death to get at her inheritance.
He didn’t get a dime; the Trust and Wills excluded any future spouses.
SHARILYN62 In order for the Will to take effect, it MUST be probated. If not, it is treated as though the deceased died intestate (without a Will). Of course, if the interests are properly put in a trust, they will pass according to the terms of the trust, and as to those interests probate is not necessary.
That is exactly what I was trying to convey. The pass through Trust must be established first as you said, the Wills are more like supporting documents.
Done correctly, no probate. Everything will pass through the trust seamlessly.
In my case, my parents passed away 5 years before I received a phone call out of the blue saying I was the heir to mineral rights. None of us had a clue, my great grandfather never mentioned it.
I do strongly suggest anyone with mineral rights set up a trust using a good attorney to be sure the heirs you want to inherit the mineral rights are the only people who get them.
A lot of greedy folks out there, had I not had the Trust and Wills to back me up, the man who married my mother to try to get her money would have succeeded. She had the mind of a two year old.
Going through court to prove she was incompetent to enter into a marriage with this flim flam man would have been costly.
Reserving a life estate also negates the benefits of the step-up in basis at the time of death that is permitted under current law.
As an example, a transfer with a life estate retention done last year would be valued at the then current oil price of say $40 / barrel. Today, taking the interest at the time of death would use today’s price of oil, or about $110. Depending on the reserve estimation, that would save a lot of capital gains tax down te road should you need to sell
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