When someone in California passes away with no estate plan or with an estate plan based on a will, their possessions must be processed through probate courts before those people named in the will (or the people named in the Probate Code, if there is no will) take ownership of the property left. This process can be confusing for many people, and not understanding how probate court works can result in problems that may lead to an unexpected outcome for your loved ones. There are five basic things you should know about the California Probate Code before you finish estate planning.
California Probate Code
- Probate usually takes four months to a year in California. Probate isn’t necessarily a short process. Creditors and other parties have four months to make formal claims against the estate, which means it will take at least this long. Generally, it will take your executor anywhere between six to 12 months to take care of creditor claims and inventory, appraise, and distribute all probate property. If problems arise with the will or the estate, it can sometimes take longer.
- Not all your assets left behind necessarily are subject to probate. Some assets can skip probate. Any community property held with a spouse or property held within a trust is transferred automatically outside of probate. In addition, accounts with a payable-upon-death beneficiary, such as life insurance, aren’t considered part of the estate. If all the total assets in the estate are valued less than $150,000, you also avoid probate court.
- Transfers of property to spouses is much simpler than to other people. If you have property that is not owned jointly with a spouse, transferring this property to them after your death is a streamlined process. The executor simply fills out a document called a Spousal (or Domestic Partner) Property Petition. There is no estate tax for spousal transfers nor any limit on how much can be transferred through this process.
- Any responsible adult you trust can act as executor of your estate. The executor of your will does not have to be an attorney in California. The executor doesn’t even have to be a resident of California (although it tends to be easier on the executor if they are living in the state). Any responsible adult can do the job, but keep in mind that it is a significant role to fulfil. Generally, a family member, such as a spouse or an adult child, who is a beneficiary takes on the role of executor. Just keep in mind, however, that particularly complex estates to settle may require the help of an attorney.
- Probate lawyers in California can charge a statutory fee, which means that you need to do your research on your probate attorney ahead of time. Probate lawyers in California are permitted to charge a fee that is a percentage of the estate instead of the flat fees or hourly rates typically charged by lawyers. Depending on the amount of the estate, this percentage will be anywhere from .5-4%–a significant amount of money for most estates. It’s important that you take this into consideration and find a probate attorney you trust now. You want to ensure that your family has the help of a California probate lawyer who you trust to do the job well and not take advantage of your loved ones. You can also ask that probate attorney whether he or she is willing to charge an hourly rate rather than the statutory fee.
As you begin the estate planning process, it’s vital to keep these and other probate law issues in mind. If you’re not sure of the best way to account for all the legal issues that may affect your family and property during probate, you’re not alone. California probate laws can be complex. That’s why it may help to do estate planning in conjunction with an experienced California probate attorney like Michael D. Larsen. We are always available to serve you.