What is Considered a "Small Estate" in Oklahoma?
Updated: Jun 8, 2020
You may have heard the term “small estate”, and you wonder: What is a small estate in Oklahoma?
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.
What can I do if my relative owned a “small estate”?
If your relative owned a small estate, it will be easier for you to collect a debt owed to the estate, to transfer personal property owned by the estate to yourself, or to transfer stocks or securities owned by the estate, to yourself. 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.
You only transfer personal property by a small estate affidavit; you cannot transfer real property (homes or land) by a small estate affidavit. To see how to transfer real property of a decedent, click here.
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.
To collect debts or transfer personal property of a small estate, follow these simple steps:
To collect a debt owed to the estate:
Prepare a “small estate affidavit.” This affidavit should say:
1. 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 $50,000.00;
2. No application or petition for the appointment of a personal representative is pending or has been granted in any jurisdiction;
3. Each claiming successor is entitled to payment or delivery of the property in the respective proportions set forth in the affidavit; and
4. All taxes and debts of the estate have been paid or otherwise provided for or are barred by limitations.
Give the small estate affidavit to the debtor. Once the debtor receives the small estate affidavit, he is required to pay you the debt he owed to the estate. If he does not pay, you may file suit.
To collect personal property owned by the estate:
Prepare a small estate affidavit. This affidavit should recite the same facts as a small estate affidavit given to a debtor (see above).
Give the small estate affidavit to the person who has possession of the personal property. The person will be required to give you the property; if he does not, you may file suit.
To transfer title to an automobile owned by the estate:
To transfer an automobile owned by the estate, fill out a small estate affidavit on a form provided by the Oklahoma Tax Commission (OTC). The OTC has made this form available online; click here to download a copy of the form. Give this form to your local tag agent, or mail it to the headquarters of the OTC. The OTC is required to transfer title to the successor.
A small estate affidavit will only be effective to transfer an automobile, if the decedent had a will, and if the decedent did not file a transfer-on-death notice with the OTC. If the decedent died without a will, or if the decedent filed a transfer-on-death notice with OTC, click here to see how to proceed.
To transfer title to other types of personal property, where a public official has control over registered title:
If the decedent owned any other type of personal property, and a public official has control over the registered title, you can also transfer title by a small estate affidavit. Ask the official if his agency has a small affidavit form that they use; if they do not, then prepare your own small estate affidavit. This affidavit should recite the same facts as a small estate affidavit given to a debtor (see above).
Give the small estate affidavit to the official, and he will be required to transfer title.
To transfer stocks or securities:
Prepare a small estate affidavit. This affidavit should recite the same facts as a small estate affidavit given to a debtor (see above). Give the small estate affidavit to the transfer agent of the stocks or securities. The transfer agent will be required to transfer the stocks or securities to the name of the successor.
To collect property held by the State Treasurer in the Oklahoma Unclaimed Property Fund
If the value of the property the State Treasurer holds is less than $10,000, you may collect the property by submitting an affidavit to the State Treasurer that says:
1. You have the right to the property, and why
2. There has not been, and will not be, a probate filed in court
3. You will indemnify that state for any loss if someone else asserts a right to the property
If the State Treasurer holds property worth more than $10,000, you will have to go to probate court to collect the property.
Take Advantage of the Small Estate Affidavit
The Oklahoma legislature has created the small estate affidavit so that you won’t have to go through a lot of extra work to transfer a small amount of property. If your relative had a small estate, and you are the successor, take advantage of this opportunity. If you have any questions about small estates, don’t hesitate to contact our office.
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.