AVOIDING PROBATE ISSUES AND EXPENSE
Feb. 9, 2021
According to the most recent statistics, the probate process can easily cost between 3% and 7% or more of the total value of an estate. If you consider attorney fees, executor's commission, and accountant fees, the overall estate administration expenses may eventually cost more. Additionally, on average, probate proceedings in California usually take up to a year and a half, and the court will freeze all the deceased’s property until asset distribution is finalized. Conversely, avoiding probate issues and expenses can help save money, time, and help accelerate the estate distribution process.
If you're trying to understand how to avoid your estate going through probate in California, it is important to consult with a knowledgeable California estate planning attorney. At The Orantes Law Firm, we are dedicated to providing experienced legal service and comprehensive guidance in estate planning matters, including wills, trust, probate, and estate administration.
We can help you understand the benefits and risks of avoiding probate and explore your available legal options. We are proud to serve clients throughout Los Angeles County, Orange County, Los Angeles, and Irvine, California.
WHAT IS PROBATE?
Probate is a court-supervised process used to settle the final affairs of a deceased person and distribute the estate's assets to the beneficiaries. The California probate process includes:
The estate's assets being gathered and assessed
Taxes and debts being paid
Beneficiaries being identified
HOW DOES PROBATE AFFECT SURVIVING FAMILY MEMBERS
Probate may affect the surviving loved ones of the deceased person in the following ways:
Probate is costly and may eventually reduce the overall size of the estate available to be inherited
During the probate process, the estate's assets, property, and bank accounts are frozen and made inaccessible to family members
The probate process is lengthy and may take many months, or even years, to finalize
Assets distributed through probate will be further subjected to federal, state, and inheritance taxes
The probate process is extremely public, resulting in a lack of privacy for assets and family members
In probate, the decedent lacks control over who inherits their estate or assets
THE PROBATE PROCESS
California probate law requires the court to appoint someone to oversee the probate process. If there is a will, the court will appoint the personal representative to assume responsibility of acting as the administrator. If there is no will, the court will appoint an executor. The appointed person will gather the estate property, pay outstanding debts and taxes, and distribute the remaining property to inheritors accordingly. The California probate process includes the following steps:
Filing Petition: The first step to initiate the probate process is to file an application for probate with the California probate court in the county where the decedent resided. The court will schedule a hearing within 30 days.
Handling Notices: After filing the petition, the county clerk will publish a notice of hearing at least three times in the local newspapers. This informs anyone interested in contesting the will or estate administration.
Proving Will: During the hearing, the judge will recognize the person's death, verify that the will is valid, and choose a personal representative, administrator, or executor.
Collecting Assets: The personal representative or appointed executor will collect, evaluate, and report all the estate assets and property to the county clerk. The person must create a detailed inventory of the estate's assets.
Identifying Beneficiaries: The executor must notify the beneficiaries, heirs of the estate, and other persons named in the will. The personal representative must take care of assets that need to be transferred to another person's name. The California probate court will determine inheritors if the person died intestate (without a will).
Paying Creditors: The personal representative or executor will also notify creditors and allow them to file claims against the estate. The person will pay valid claims and debts from the estate's assets.
Paying Estate Taxes: The personal representative or executor also has to ensure that estate taxes are paid, including California state and federal estate taxes.
Resolving Disputes: Also, the personal representative or appointed executor must resolve all disputes and family conflicts between surviving loved ones.
Distributing Assets: Once taxes and debts are paid and disputes are resolved, the administrator will then distribute the remaining assets and property to heirs and beneficiaries.
HOW TO AVOID PROBATE ISSUES
Some possible options to avoid probate in California include:
Wills: A will is a legal document that contains certain instructions about how a person's asset should be distributed to surviving loved ones or disposed of upon their death.
Trusts: A trust is a fiduciary relationship whereby a person (trustor or guarantor) appoints another person (trustee or successor trustee) to handle the trustor's final affairs, manage estate upon death, and transfer assets and property to the beneficiaries.
Joint Tenancy: If a property is listed with more than one owner, it will be automatically transferred to the surviving owner(s) without going through probate.
Some other ways to avoid probate include:
Tenancy by the entirety
Transfer on death accounts
Payable on death accounts
WILLS VS. TRUSTS
Wills and trusts are among the available options to avoid probate in California. Wills are economical upfront but won't allow your family members to avoid probate completely. The personal representative must still present the will to the California probate court to verify its validity.
Conversely, trusts are a bit trickier and pricier upfront, but they can help prevent your surviving loved ones from going through the probate process upon your death. A knowledgeable estate planning attorney can evaluate your unique situation and decide the right option that best fits your needs.
GET HELP WHEN
Avoiding the costly and lengthy California probate process can help fast-track the estate distribution process and save money. If you're trying to determine the right steps to take to avoid potential probate issues and expenses, you need to speak with an experienced California estate planning attorney for proper guidance and to protect your rights, assets, and loved ones.
At The Orantes Law Firm, we are dedicated to guiding clients through the complexities of estate planning and administration. As your representation, we can review the circumstances surrounding your unique situation and help you understand your possible legal options to avoid probate. We can also help you update existing wills or trusts. We will offer you the comprehensive guidance you need to avoid the whole probate process and make informed decisions.
Contact us at The Orantes Law Firm today to schedule a one-on-one case assessment. We proudly serve clients throughout Los Angeles County, Orange County, Los Angeles, and Irvine, California.