Estate Planning

For more than a century, Indian families have seen valuable land resources diminish as fractionated ownership increases with each passing generation. ILTF supports estate planning as one of the most effective ways to stop the continued division of Indian land titles and ensure that Indian lands are controlled and managed by Indian people. Over the years, ILTF has funded projects that provide education and free estate planning services for tribal members across the Pacific Northwest, Oklahoma, North Dakota, South Dakota, Minnesota, and many more places. As a result, more than 3,500 landowners have received direct legal service and will writing assistance. In addition, more than 7,500 people, including elected tribal officials, landowners, attorneys and Indian land heirs have received training through ILTF-funded estate planning programs.

New! Landowner resources

ILTF has visited countless tribal communities in recent years to provide landowner information on estate planning and will writing. Over the past year, the COVID-19 pandemic has halted all travel in order to protect the health and well-being of elders and others in the community. As a result, ILTF has now developed a series of online resources to help Native American landowners, individual agricultural producers and tribal leaders to better manage their land.

Regular information distribution

ILTF will distribute information via email on the 2nd Tuesday of each month throughout 2021 to educate and engage community members on critical issues. We will provide multiple ways for tribal members and others to actively participate in building their knowledge of Indian land laws, regulations and court cases in order to effectively manage their inheritance. The information will also be available here for future reference.

Town Hall meetings

ILTF is now hosting Town Hall-style meetings online where subject matter experts will answer questions and help participants to better understand important land issues. ILTF invites landowners and agricultural producers to offer information on the problems they face along with potential solutions that could help others in Indian Country. Information on upcoming Town Hall meetings will be distributed by email and posted here.

Click here to watch the May 25 Town Hall Q&A Session on the Basics of Estate Planning.

LANDOWNER INFORMATION

The following information for landowners is organized by the date it was distributed via email. Please email jwabindato@iltf.org if you would like to be added to the distribution list.

 

June 8, 2021: Appraisal Basics for Landowners

Nearly every land transaction in Indian Country requires an appraisal (valuation) of the land and/or its resources. The U.S. Department of the Interior (DOI) uses those values in processing applications for sales, leases, rights-of-way, land exchanges, trespass, probate, and other types of transactions. The time it takes to complete an appraisal can make or break a transaction, so it’s important for landowners to know the rules and processes involved in the appraisal and valuation of Indian land.

In June 2016, Congress passed the Indian Trust Asset Reform Act (ITARA) which made three major changes that affect the valuation of Indian lands:

  1. A single office of Appraisal and Valuation Services Office (AVSO) was created to administer the appraisal process.
  2. Minimum qualifications were established for individuals to prepare appraisals and valuations.
  3. A process was developed to waive review or approval by DOI when a valuation is conducted by a qualified appraiser.

Critical issues

Landowners should be aware of a number of critical issues with Indian land appraisals which are outlined below.

Appraisal Request Process – The process always begins at the Bureau of Indian Affairs (BIA). A landowner or party interested in using or buying Indian land will need to discuss their request for an appraisal with BIA staff, and will need to submit the appropriate transaction application (sale, lease, etc.). Other documents may also be required, including:

  • Land Title Status Report
  • Survey
  • Probate order
  • Tribal authorization

Appraisal Review Waiver – The Waiver rule requires the Department to forego review and approval of the appraisal or valuation and consider the appraisal or valuation final if three conditions are met:

  1. The appraisal or valuation was completed by a qualified appraiser
  2. The Indian tribe or individual Indian expressed their intent to waive DOI review and approval at the same time as the transaction request
  3. No owner of any interest in the property objects to the use of the appraisal or valuation without DOI review and approval.

There are exemptions for certain kinds of transactions that still require Departmental review, including the Land Buy Back Program, purchase at probate, and for acquisitions by the U.S. government such as fee-to-trust. (Appraisal Waiver Package Checklist)

Using an Outside Appraiser – When an appraisal is conducted by AVSO, it can take months or even years for landowners to receive an appraisal report. Landowners can speed up the process by using their own appraiser. Please be aware of some key issues before heading down this road.

  • First, the funds to pay the outside appraiser are your responsibility. Once the landowner chooses to go outside of the DOI process they also agree to pay the appraiser’s fees which will likely be required in advance.
  • Seller(s) must agree to the appraisal valuation. If any seller disagrees with the value they will likely refuse to sign the waiver application.
  • Waiver applications that don’t have the appropriate signatures will automatically  be denied.
  • Without Interior approval or an accepted waiver, the transaction will die.

Important definitions to know

Appraiser – One who competently performs the valuation services in an independent, impartial, and objective way.

Appraisal – The act or process of developing an opinion of value.

Fair Market Value – An opinion of what a property would sell for in an open and competitive market, and a what a ready, willing and able buyer might pay for a property in the current market.

Highest and Best Use – Highest and best use is about what the land could be used for, not what it is being used for right now. In order to be considered the highest and best use the value must meet four criteria: Be legally permissible, physically possible, financially feasible, and appropriately supportable by the current market.

Sales Approach – Method of appraisal based on direct comparison of between the property being appraised and other properties sold or listed for sale in the area.

Income Approach – Appraisal method commonly used for commercial properties. Asks how much income the property can produce, including the proceeds of a future sale.

Cost Approach – Appraisal method that determines value by combining the value of the land with the cost to reproduce all of the improvements, less depreciation.

Site Specific Appraisal – An appraisal process that analyzes one tract of land at a time, based on physical and economic characteristics on the subject property compared to similar properties.

Mass Appraisal – Process used to value many properties that are similar in use (For example, dry crop pasture or vacant land) and have active/consistent markets or comparable sales data. The process uses common data, standardized methods and statistical testing and allows for greater efficiency and consistency in valuations.

Project Appraisal Report – A multiple tract appraisal report that includes the appraisal of more than one tract in a single report. The most relevant method of valuation is the same for all tracts and the report format follows the requirements under Uniform Appraisal Standards for Federal Land Acquisitions (UASFLA), Section 17-D.

Mineral Deposit – Identifiable geological occurrence of minerals of a size and concentration that may have the potential for economic recovery, now or in the future. Typical minerals may include oil, gas, sand and gravel. Mineral values are determined by the Division of Minerals Evaluation, a part of the Appraisals and Valuation Services Office (AVSO) within the Department of the Interior.

Additional Resources

Waiver of Appraisal Review

Indian Land Appraisal Webinar – On October 22, 2020 ILTF hosted a 90-minute webinar with Tim Hansen, Director, and Gregory Powell, Regional Supervisory Appraiser, from the Appraisals and Valuation Services Office (AVSO). The webinar explored changes to AVSO and looked at technical aspects of Indian land appraisals.

AVSO Overview

 

May 11, 2021: The Basics of Estate Planning

It is critical for Indian landowners to take the legal step of writing a Will to control their assets and avoid potential family conflict. But there is more that can be done to protect your health and your children, and ensure that your other wishes are carried out after you are gone. Understanding the basics of preparing a comprehensive estate plan can help Native people simplify the process of passing their land, personal property and significant cultural items on to the next generation.

Nobody can prevent death, but we can prepare for it. Proactive estate planning means being prepared, and having a Will is a good place to start. A comprehensive estate plan should include more than just your Will. A good estate plan will simplify the probate process and allow others to act on your behalf. The following resources Will not only provide you with information on how to take the next steps, but will briefly explain the different choices you can make in preparing your estate plan.

The Indian Land Tenure Foundation (ILTF) recommends seeking guidance from an attorney who is knowledgeable about Indian probate. Finally, you should also pay attention to the probate rules of your particular tribal nation, the state where you live, and the federal government because each of them can have an impact on your estate after you pass away.

Important Concepts for preparing your Will

Why do I need a Will? – Whether you are 80 years old or 18, there are many good reasons to have a Will. Having a Will may save you time and money, and ensure your peace of mind. It enables you to give your property to the people you want to have it after you are gone. And having a Will can make the probate process happen more quickly and more easily.

Witnesses for a Will – When executing a Will, you will need at least two witnesses who should be unrelated to you. For example, siblings and other immediate family members usually stand to benefit from a Will and, from a legal standpoint, would not be the best witnesses. A court could potentially void your Will if the motivations of the witnesses seem questionable.

Self-proving affidavit – The person who is making a Will (legally known as the ‘testator’) is highly encouraged to include an ‘attestation provision’ within the document. A ‘self-proving affidavit’ within a Will, authenticates the testator’s mental capacity as verified by the two signing witnesses.

‘Joint tenancy’ or ‘tenancy in common?’ –‘Joint tenancy’ and ‘tenancy in common’ provide each owner with the right to use or make decisions for the whole property, not just a specific piece of it. ‘Tenancy in common’ is the most well-known form of trust property ownership. It retains the ability to sell your interest in the land, or leave it to someone in a Will, without the consent of any other owner. ‘Joint tenancy’ with the ‘right of survivorship’ leaves the shared interest in property to the last living heir. It is important to know the difference between ‘joint tenancy’ and ‘tenancy in common’ and to clearly state your wishes in your Will. If a Will doesn’t specify the situation, the judge is required by law to give the land to your heirs as joint tenants.

Disinheriting a spouse – ‘Disinheritance’ is a tool you can use in order to specifically prevent a family member from inheriting property. Disinheritance of a spouse is controlled by state law and can be difficult to accomplish.

Disinheriting a child – Disinheriting a child in a Will can be difficult, both for personal and legal reasons, but it can be done. Omitted heir statutes give rights to all heirs, whether they are named in the Will or not. If the child is disinherited incorrectly, it may give them a claim to a share of the estate. An omitted heir statute does not apply if the child was omitted from the Will intentionally and in writing.

Other strategies to complete your estate plan

Why do I need an ‘advance directive?’ – An ‘advanced directive’ for healthcare is a legal document that offers an efficient way to clearly make your plans for health decisions known even if you are unable to do so during a medical emergency. An ‘advance directive’ will help your loved ones advise medical personnel and make decisions consistent with your wishes.

Why do I need a ‘Power of Attorney?’ – A Power of Attorney (POA) is an essential legal document that enables the principal to grant either broad or limited powers to another party known as an ‘agent.’ Powers are specific to financial or legal matters and may include tax preparation and filing, investment account management, representation in lawsuits, etc. Power of Attorney can be granted immediately or once the principal becomes incapacitated.

Probate avoidance – Transferring certain assets outside of probate can be easier and more timely than going through the probate process. Financial assets, such as bank accounts, retirement accounts, and life insurance policies, offer the opportunity for you to name a beneficiary to receive your money. If you leave that line blank, those assets have to go through probate so that a judge can determine who will receive those assets. Some states, such as Oklahoma, may also provide for the transfer of non-Indian real estate and motor vehicles. A knowledgeable attorney can discuss the possibilities available to you in your home state so that you can make informed decisions.

Additional Resources

Estate Plan Preparation Checklist

Legal/document examples from Oklahoma

Will in a Box – A free tool available for American Indians who own trust land in Montana, Minnesota and Oklahoma. This online resource can be used to plan or even create your Will. Scroll down this webpage and look for Will in a Box resources.

Click here to watch the May 25 Town Hall Q&A session on the Basics of Estate Planning.

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March 9, 2021: The Basics of AIPRA

Understanding the American Indian Probate Reform Act (AIPRA) is vital for Native people because it spells out what the U.S. government will do with an individual’s Indian land when they die. If landowners don’t want a judge to decide what happens with their land, they need to understand AIPRA and how it works.

AIPRA is a uniform federal probate code that applies to most allotted reservations, although some 20 tribal nations and communities have their own federally-recognized probate laws or codes. It was enacted on Oct. 27, 2004 as an amendment to the Indian Land Consolidation Act (ILCA) of 1983 and is applied in the probate of trust assets for Indian landowners who died after June 20, 2006.

The Law

AIPRA defined and clarified a number of issues relating to the probate of estates and Indian land. As an amendment to ILCA it also promotes a federal policy to consolidate or reduce fractional ownership of Indian lands. It also removed Indian probates from state rules for inheritance.

Eligible Heirs

AIPRA placed into law a rigid definition of eligible heirs that the Department of Interior must use when conducting a probate of trust assets. This is important whether and Indian landowner leaves a will or dies without one (intestate).

Single-Heir Rule

This often-overlooked part of AIPRA applies when a Native person with trust assets dies without a will. Landowners with highly-fractionated title (owning less than 5% or 1/20) who die intestate will be forced into this federal land consolidation policy at  the expense of the heirs. According to law, the inherited land will not be evenly divided among the children, but will instead automatically go only to the oldest child. This issue is covered by the AIPRA law (§2206 Descent and Distribution).

  • Click here for presentation slides on this subject.

Joint Tenancy Implied

Indians have become so used to fractional ownership that this change to the probate process can also come as a surprise to landowners who do have a will. The application of Joint Tenancy to ownership will stop many heirs from being able to transfer land to their children. This is covered by federal law, which can be found in §2206 Descent and Distribution.

Permanent Improvements

A technical amendment to AIPRA was signed into law in December of 2008. It made a change to land ownership that further separates Indian land law from any other type of property law. The change has an impact on homes, barns, fences and other permanent changes to a property. This is covered by federal law, which can be found in §2206 Descent and Distribution.

AIPRA Exclusions

AIPRA does not apply in the following tribes/communities with their own probate laws/codes:

  • Alabama-Quassarte Tribal Town
  • Cherokee Nation
  • Chickasaw Nation
  • Choctaw Nation
  • Confederated Tribes of the Umatilla Reservation
  • Fond du Lac Band of Chippewa Indians
  • Kialegee Tribal Town
  • Klamath Reservation
  • Lake Traverse Indian Reservation (Sisseton-Wahpeton Oyate)
  • Muscogee (Creek) Nation
  • Nez Perce Indian Reservation
  • Northern Cheyenne Tribe
  • Osage Nation
  • Seminole Nation of Oklahoma
  • Spirit Lake Sioux Tribe
  • Standing Rock Sioux Tribe
  • Thlopthlocco Tribal Town
  • United Keetoowah Band of Cherokee Indians
  • Warm Springs Reservation
  • Yakama Reservation

Additional Resources

Will in a Box – Indian wills made easier

 

Your land may be the most important thing you own, but you won’t be able to leave it to your children if you don’t take action now. If you die without a will, it will be up to a federal probate judge – not you or your kids – to determine who will inherit your land after you have passed on, and it could take years to decide. ILTF is pleased to introduce a new tool that can make it easier for Indian landowners to have a will.

Will in a Box makes it easier to write a will

Developed by ILTF in conjunction with legal service organizations across Indian Country, Will in a Box is now available for American Indians who own trust land in Montana, Minnesota and Oklahoma, and we’re working on expanding to other states in the future. Hosted on the Law Help Interactive web platform, Will in a Box is free of charge to tribal members.

Click here to see a checklist of items you’ll need to have on hand to complete the Will in a Box process.

Click here to go to the Will in a Box website to begin writing your Indian will. (Site may take a moment to load)

TAKE CONTROL OF YOUR LAND AND YOUR FAMILY’S FUTURE!

 

Will Writing & Legal Services

 

Today, ILTF continues to build upon its estate planning and probate program by developing new, more efficient and cost-effective models for helping Indian people safely transfer their lands from one generation to the next. ILTF is currently working directly with qualified contractors throughout the country who provide specialized legal and will writing services and training to tribal members in the communities and on the reservations where they live. By providing services that reduce fractionation, and training that informs Indian people about the laws governing land ownership and transfer, ILTF empowers tribes and individual landowners to protect their land assets and preserve economic and cultural resources for future generations.

Partnering with local law firms

ILTF regularly utilizes grant resources in addition to its own resources to provide estate planning services. Partnerships with legal service providers are vital to addressing unmet needs. The scope of these projects has expanded to supplementing landowner options with policy development that make wills easier to complete, improves the probate process, and generates new forms of ownership that families can use to better manage and benefit from their land.

 

INDIAN LANDS IN INDIAN HANDS