OREGON WILLS AND TRUSTS REQUIREMENTS
Statutory Authority.
Wills: Oregon Rev. Stat., Chapter 112 (ORS ยง112.245, et. seq.).
Trusts: Oregon Rev. Stat., Chapter 130 (ORS ยง130.040, et. seq.).
Oregon Will Requirements.
To form a valid will in Oregon, a testator must be at least 18 years old (or legally married or an emancipated minor) and โof sound mind.โย ย
Oregon wills must be in writing and must be signed by the testator (or someone who signs at the testatorโs direction while in the testatorโs presence) and two witnesses.ย Witnesses must observe the testator signing the will or hear the testatorโs declaration that the testatorโs signature is genuine.ย ย
An Oregon willโs witnesses must sign the document within a reasonable time before the testatorโs death.ย Witnesses may alternatively attest a will by executing an affidavit contemporaneously with the execution of the will.ย An Oregon will is not invalid solely because it is attested by an interested witness.
In Oregon, a written document that does not technically satisfy all formalities required for a valid Oregon will may nonetheless be treated as a valid will if a proponent of the document can establish by clear and convincing evidence that the decedent intended for the document to be treated as the decedentโs will.ย ย
Oregon law permits wills to incorporate by reference other written documents in existence when the will is executed the will clearly expresses the intent to incorporate the other document.ย The incorporated document must also be sufficiently described in the will to allow identification.
Oregon specifically recognizes a testatorโs right to incorporate by reference a documentโoften called a memorandum of personal propertyโmaking dispositions of certain personal property items.ย The memorandum must be signed by the testator and referenced in the will, and must describe the disposed items and beneficiaries with reasonable certainty.ย ย
Oregonโs statute expressly authorizes use of memoranda of personal property for household items, furniture, furnishings and personal effects.ย Real estate, property subject to a certificate of title, or property primarily used for trade or business cannot be included. ย The written document can be created before or after execution of the will, and the testator may alter a memorandum of personal property after its initial creation.ย ย
Oregon wills do not require notarization, but a will can be made โself-provedโ through execution of a compliant affidavit by witnesses.ย The self-proved affidavit provides witness attestation as to the authenticity of the testatorโs signature and can be executed contemporaneously with or after execution of the will.ย If present, the affidavit serves the same role in probate as the witnessesโ testimony regarding the authenticity of the will.
Amendment, Revision, and Revocation of Oregon Wills.
Express revocation or amendment of an Oregon will can be accomplished through execution of a codicil (a separate document that amends an existing will) or another will.ย In either case, the document must satisfy all legal requirements for execution of the original will.ย ย
An Oregon will may also be revoked by a physical act (such as by burning or tearing the will) performed by the testator (or someone else at the testatorโs direction and in the testatorโs presence) with the intent of revoking the will.ย ย
If an Oregon will is revoked, it can only be revived through re-execution of the will or execution of a new will that incorporates the previously revoked will by reference.
If the testator of an Oregon will marries after executing a willโand if the spouse survives the testatorโthe will is deemed to have been revoked.ย The implied revocation is inapplicable if the will expresses an intent that it not be revoked by subsequent marriage, the circumstances suggest that the will was created in contemplation of marriage, or the testator and spouse entered into a prenuptial agreement providing for the spouse (or stating that the spouse has no rights in the testatorโs estate).
If, after executing an Oregon will, a testator is divorced, any provisions in the will in favor of the former spouse are considered to have been revoked, unless the will expressly provides otherwise.ย ย
If a child is born to or adopted by a testator after execution of an Oregon willโand if the will does not provide for or otherwise mention the childโthe after-born child inherits a share of the testatorโs estate unless the testator had other children when creating the will and the other children are also excluded from the will.ย If the testator has other children who are provided for under the will, the after-born childโs share is calculated based upon the devises to the other children.ย If the testator has no other children, the share is equal to what the child would have inherited had the testator died intestateโexcept that an omitted childโs share is inapplicable if the will leaves substantially all of the estate to the childโs other parent.ย
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Holographic and Oral Wills.
Oregon does not recognize holographic (or handwritten) wills.ย A handwritten will may still be valid, but it must comply with all other formalities (such as witnessing) required to create a valid will under Oregon law.
Oral (or โnuncupativeโ) wills are not recognized under Oregon law.
Oregon Trust Requirements.
Oregon trusts are primarily governed by the Oregon Uniform Trust Code, as enacted by the Oregon legislature at ORS ยงยง130.040, et. seq. ย An Oregon trust can be formed for most any purpose under Oregon law; provided, however, the purpose of an Oregon trust must be lawful, possible to achieve, and not contrary to Oregon public policy. In general, the terms of a trust and the trust itself must be for the benefit of the trustโs beneficiaries.ย An Oregon trust is void to the extent its creation was induced through fraud, duress, or undue influence.
Oregonโs Uniform Trust Code specifically authorizes โcharitable trustsโ created for a charitable purpose (such as the relief of poverty, advancement of education or religion, or promotion of health, governmental, or municipal purposes), โstewardship trustsโ created to hold interests in business entities, trusts to hold life insurance, and โpet trustsโ for the care of animals.ย
To create a valid trust under Oregon law, the settlor must express an intent to create a trust and have adequate capacity (measured under the same standard applying to wills). Unless an Oregon trust is expressly made irrevocable, the settlor is assumed to retain the power to revoke or amend the trust.ย ย
Additionally, Oregon trusts must have a definite beneficiary (subject to exceptions such as for charitable trusts, trusts for the care of animals, and certain trusts created for noncharitable purposes), along with a trustee with actual duties to perform.ย The trustee of an Oregon trust has a duty to administer a trust prudently, taking into account the trustโs terms, purposes, and circumstances. ย The sole trustee of an Oregon trust cannot also be the trustโs sole beneficiary.ย ย
Oregon trusts can be created through transfer of property by a settlor to a trustee (either during life or through a will or other testamentary instrument), a declaration by the owner of property that the property is owned as trustee, by exercising a power of appointment in favor of a trustee, by an agent acting under a power-of-attorney expressly authorizing creation of a trust, or through a statute or judgment requiring administration of property in a trust.ย ย
Though most trusts are evidenced by a written instrument setting forth the trustโs terms, the Oregon Uniform Trust Code allows for oral trusts if the terms can be established by clear and convincing evidence.ย However, certain types of trusts must be evidenced by a formal writing under Oregon law.ย ย
Although creditors of a trustโs beneficiaries may generally attach a beneficiaryโs interest in a trust, Oregon law protects beneficiary interests from attachment if a trust includes a โspendthrift provisionโ restricting beneficiariesโ right to transfer interests in the trust.ย If a spendthrift provision is present, most creditors of beneficiaries cannot attach trust assets until actually distributed to the relevant beneficiary. However, spendthrift provisions do not prevent attachment for satisfaction of certain domestic support obligations, tax claims, or if the creditor provided services for protection of the beneficiaryโs interest in the trust.ย
Creditors of an Oregon revocable trustโs settlor can attach trust assets as long as the settlor remains living (or, upon death, through estate claims).ย In the case of irrevocable trusts, settlorsโ creditors can reach the maximum amount of trust assets that could be distributed to the settlor or for the settlorโs benefit.ย However, an irrevocable trust cannot be attached by a settlorโs creditors solely because the trustee is authorized to reimburse the settlor for tax payments.
Oregon trusts terminate upon revocation or expiration under the trustโs own terms, when there is no purpose of the trust remaining to be achieved, or when the trustโs purposes become unlawful, contrary to public policy, or impossible to achieve. A trust may also be modified or terminated by a court upon the petition of the settlor, trustee, and/or beneficiaries.ย Or, in some circumstances, modification or termination of a trust may be made upon the consent of the trustee and all beneficiaries. Upon petition, a court may also reform or modify the terms of a trust to conform to the settlorโs intent or achieve the settlorโs tax objectives.
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Essential Legal Protection for AchieversSpecial Considerations.
Estate Taxes: Oregon is among the relatively small minority of states that still impose a state-level estate tax.ย Estates in Oregon with a value above $1,000,000 qualify for the estate tax.ย The tax is assessed on amounts over the limit at rates progressing from 10 โ 16%, depending on the total estate value.ย Oregon does not impose an inheritance tax.
Simplified Probate:ย Oregon law allows for a simplified probate process for small estates, allowing administration without the full probate process.ย To qualify as a โsmall estate,โ the estateโs total value cannot exceed $275,000, real estate value cannot exceed $200,000, and personal property value cannot exceed $75,000.ย To apply for simplified probate, the inheritor of an Oregon decedentโs property must submit to probate court an affidavit including information regarding the decedent, estate, creditors, heirs, and a few other items.ย Upon approval, the representative can take possession of assets, pay claims, and distribute property.
Transfer-On-Death (TOD) Designations:ย Along with living trusts, Oregon provides several additional options for transferring assets outside probate.ย Assets co-owned as joint tenants with a right of survivorship automatically transfer to a surviving owner upon the other ownerโs death.ย Similarly, assets owned in a tenancy by the entireties are subject to a right of survivorship in favor of the surviving owner.ย In Oregon, tenancy by the entireties may only be used by married couples and only be used for ownership of real estate.
POD (payable-on-death) and TOD (transfer-on-death) designations, which provide for automatic transfer to a beneficiary upon an ownerโs death, can also be used in Oregon for many assets.ย For instance, POD designations can be added to financial accounts and CDs, and TOD designations can be used with assets like registered securities and brokerage accounts.ย ย
Similarly, some assetsโlike retirement accounts and life insuranceโallow owners to name a beneficiary who automatically takes ownership of the asset upon the original ownerโs death.
Transfer-on-Death (TOD) Deeds and Vehicle Titles:ย Oregon is among the minority of states that recognize TOD designations on real estate deeds.ย Real property subject to a TOD designation automatically transfers to the named beneficiary upon the ownerโs death, avoiding the need for probate.ย Oregon does not recognize TOD designations on vehicle titles.
Spousal Shares: To protect against disinheritance, Oregon law affords surviving spouses a right (waivable by a valid pre- or post-nuptial agreement) to claim a spousal elective share in a decedent spouseโs โaugmented estate.โ ย The percentage of a decedent spouseโs augmented estate included within the elective share ranges from 5 to 33 percent, depending on how long the couple has been married.ย Along with wealth within the decedentโs probate estate, the augmented estate includes the value of non-probate assets (such as assets held in joint tenancy or subject to POA designations) and the value of the surviving spouseโs estate.ย ย
If a decedent is intestate, the surviving spouseโs intestate share is the entire net estate unless the decedent leaves descendants who are not also descendants of the surviving spouseโin which case the share is one-half of the net estate.
Creating a will or trust does not have to be difficult or intimidating.ย However, certain circumstancesโlike second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests (to name a few)โcan add a layer of complexity and result in unforeseen long-term consequences.ย Whenever any out-of-the-ordinary issues are present, itโs a good idea to consult with an experienced attorney familiar with and licensed under the laws of the relevant jurisdiction.