Planning for the end of your life is not a task that should be delayed, especially if you have assets that you would like distributed to your family. Unfortunately, your family and loved ones will need to go through the grief and adjustment period of losing you while also handling the associated legal complexities. California law requires that a probate court process occur following a person’s death to validate their will. This process executes a number of tasks designed to guarantee the decedent’s assets are distributed to the appropriate beneficiaries. Luckily, there are actions that you can take to help your family avoid as much of the probate process as possible while also protecting your assets.
Why Avoid Probate?
Though probate does have its usefulness in some circumstances, it is often an unnecessary extra step for your beneficiaries to receive the assets you would like to leave to them. There are several reasons to avoid probate when possible. The probate process could take months or even years to complete, and none of the assets are distributed until it is finalized. The total value of your assets will also be reduced, as there are associated costs with the probate process: appraisal fees, court costs, attorney fees, and valuation fees. Probate court is also on public record—this, along with the delay caused by the courts, can expose your assets to unhappy relatives or creditors that could contest the will.
How to Avoid Probate in California?
There are numerous compelling reasons to avoid probate. Fortunately, there are several avenues available to you to keep your assets out of probate. Most strategies focus on minimizing the value of your estate in your name because some states allow a simplified probate process if your estate value is below specific levels. The best route for you depends entirely on the type of assets you own.
- Place Assets in a Revocable Living Trust Creating a revocable living trust allows you to move assets into the trust. This keeps the assets from being in your name alone and makes them unavailable for probate control. You will maintain complete control of your assets until your death, at which point the trust will manage your assets in the way that you specified. For example, you have the option to immediately distribute the assets as a lump sum or wait until the beneficiaries meet certain milestones, like reaching 21 years old or graduating from college.
- Jointly Owned Property Most property owned by one or more people has rights of survivorship. This means that if one of the owners dies, the assets will be transferred to the other owner(s). Because the assets automatically transfer, they are not considered a part of the probate estate and avoid the probate process. A common example of jointly owned property that transfers via rights of survivorship is property shared by a married couple, like their home.However, there are some types of joint property that do not have rights of survivorship. It is critical to consult with an experienced estate planning attorney to understand the complexities of property transfer and ensure that your joint property will transfer as intended.
- Identify Beneficiaries for Your Accounts Some accounts can pass directly to a named beneficiary after the account owner’s death. The funds are not considered a part of your probate estate and will not count towards its total value. Accounts that can be handled this way include life insurance and retirement accounts. Bank accounts and other taxable accounts can be designated with a Payable on Death (POD) or Transfer on Death (TOD) registration that allows the beneficiary to take over the account.
- Give Away Assets Before You Pass Probate assets can only include the property you owned at the time of your death. Any assets given away before that time are excluded from your total estate value. This also gives you the opportunity to see your loved ones enjoying the belongings you pass on to them. You can also donate assets to charity before your death. It is vital to remember that you cannot anticipate exactly how long you will live or the finances you will require for healthcare and other cost of living expenses, so you must ensure that you can live comfortably before losing control of your assets.
Frequently Asked Questions
Q: What Is the Limit to Avoid Probate in California?
A: If a person’s assets total less than $184,500, they can avoid the probate requirement. This is important as the probate process can take months or even years to complete while also reducing the total value of your assets through court fees. The methods above are intended to reduce the overall value of your assets that are subject to probate court.
Q: What Assets Are Exempt From California Probate?
A: There are some types of property and assets that do not need to go through probate. Property held jointly with a right of survivorship clause is exempt and automatically transfers to the other owner(s). Retirement accounts and life insurance policies avoid probate court by having a designated beneficiary. Assets placed in a living trust are also exempt from probate and will transfer as directed by the account owner.
Q: Can I Handle the Probate Process Without a Lawyer?
A: It is entirely possible to go through probate court without the support of a lawyer. Unfortunately, probate laws are complex and can be prone to changes, making the process difficult. A knowledgeable probate lawyer can simplify the process by providing their expertise.
Q: Do All Wills Go Through Probate in California?
A: Though most wills are required to go through probate court in California, there are some exceptions. You can keep your estate from going through probate if the value of your assets is less than $184,500. Certain types of accounts and all assets placed in a living trust can also avoid the probate process in California.
California Estate Lawyer
Avoiding probate is a complicated process, especially when you must decide on the best methods for each asset type. Consider retaining an experienced estate lawyer who can help guide you through these situations and find the best ways to handle your estate. At Quinn & Dworakowski, LLP, we have spent over 50 years representing Californians in estate and probate law, and we are ready to help you with planning your estate.
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