The vast majority of estate planning is undertaken to avoid probate. Probate is the process by which the state determines a deceased person’s will to be either invalid or valid. In this system, the courts of a state take control of a deceased person’s property and oversees its distribution. In some states, a dedicated probate system undertakes this task; in others, probate is a division of a district court. This is the case in California.
As the probate process is cumbersome, drawn out, and emotionally exhausting, most families do their best to avoid it. However, sometimes estates or other family issues fall into dispute despite preventative planning. If you find yourself facing the probate process, your best weapon is information. Here’s what you need to know about California’s probate system before you face it.
The California Probate System & Process
The probate process does not always have to take place. Those who have previously enacted a trust or joint survivorship with the help of a legal professional have already designated their preferred distribution of assets; in the case of one spouse inheriting from another, all the surviving spouse has to do is produce a death certificate for disbursement. It is also possible for family members and other potential or intended beneficiaries to agree to division of assets without the court’s intervention.
In California, beneficiaries of people who die with assets totaling less than $150,000 are usually spared the probate process. In the case of distribution of these smaller amounts, beneficiaries are permitted to claim assets with an affidavit or the shorter, less complex summary probate process. Spouses or domestic partners may use a form called the Spousal or Domestic Partner Property Petition to establish his or her claim to property. This may or may not include community property.
In the event a person has not done any estate planning, or if the last will and testament is contested, the probate process usually steps in. It begins when any family member or potential beneficiary files with the state court. This person is usually the will’s executor. In the event the executor has also passed away, or is unreachable or incapacitated, another family member may petition to become the estate’s “administrator,” which is a different title for an identical job.
Expectations of the Executor
The executor or administrator must file the will, if it exists, with a “petition for probate” in the probate court of the county in which the person who has died maintained his or her legal residence. The person who has the original copy of the will, called its “custodian,” is required to file it within 30 days. In most counties in California, the charge for filing is $435. Others cost more.
At this point, the executor’s work truly begins. Family members, other potential beneficiaries, and creditors, if they are known, must be notified of the beginning of the probate process. The court then determines if the will was legally valid through examination of sworn statements. The executor must then begin to identify the assets—be they real estate deeds, car registration, proof of bank accounts, or personal items—and open a separate bank account to manage the matters of the estate. The executor is also responsible for keeping the estate’s assets secure by protecting personal property and keeping real estate in good repair. A separate taxpayer ID is usually also necessary.
Property which is under dispute should be inventoried and appraised, the costs for which are either paid out of the account or paid for by the executor with the understanding that he or she will be reimbursed once the estate is liquidated or disbursed. The executor is also expected to file tax returns on the dead person’s behalf and maintain insurance payments on any property.
For the most part, the executor may act without the approval of the probate court under the permission of the Independent Administration of Estates Act. This means the executor may sell the deceased person’s personal items, meet tax requirements, and either pay or dispute creditors, who have four months after the time of the person’s death to demand payment.
Some people, in their estate planning, do not provide for final expenses beyond life insurance policies for dependents. They may not realize that hospice and burial costs must be paid out of the estate. California law has determined the order in which these claims must be paid in the event the estate runs out of money.
This process usually takes about a year. After debts have been settled and the IRS satisfied, the executor may petition the court to legally close the estate. It is at this point when the executor is permitted to divide the estate as the court has determined.
What About Conservatorships?
Division of property, appointment of executors, and determination of the validity of wills isn’t the only job of probate courts. In some cases, they are also used to appoint legal guardians or conservators for minors, adult disabled people, or the incapacitated elderly.
Probate conservatorships are the process by which judges appoint a competent adult, the conservator, to care for another legal adult who cannot care for him or herself, be it due to injury, disability, illness, or age. Conservators are usually invested with the ability to make financial decisions on behalf of the conservatee.
What About Guardianships?
Guardianships are different from conservatorships. Guardians are usually appointed for minors who are not currently wards of the state, involved in Juvenile Court, or whose cases are under consideration by Family Court. Guardians are not the child’s parents, and are usually the child’s grandparents. In some cases they may be aunts and uncles or even family friends.
Guardians are responsible adults who may make major decisions regarding the child, as well as caring for any assets the child will eventually inherit. In some cases, a private guardian may not be available; should this happen, the child comes under the jurisdiction of the county’s office of the public guardian.