Are There Benefits to Probate?
While probate can be a highly involved undertaking, it was designed to protect creditors and beneficiaries from the harmful actions of dishonest or inexperienced executors and administrators. If you are a beneficiary who is anxious to receive an inheritance or property, you can take comfort in knowing that the courts will closely monitor the personal representative's actions in order to ensure that you receive what you are entitled to. If you were appointed an executor or administrator of an estate, you can be glad that the state has created a blueprint for you to follow during the administration process.
Some of the benefits of probate include:
- Debts and taxes will be paid
- The entire process will be supervised by the court
- Beneficiaries will be notified of probate proceedings
- Fiduciaries (executors or administrators) are held to the highest standards of fiduciary duty
- If there is a will contest, there is a forum to address a dispute
- If the executor or administrator engages in self-dealing, they can be held liable
- If an executor fails in their duties, the beneficiaries can petition for their removal
- All loose ends are wrapped up
- Close supervision of the personal representative
- Forum for dispute resolution
- Time limitation for creditors' claims
In many instances, knowing that the distribution of one's estate will be closely supervised by the court is comforting, especially when there is a fear of family disputes or concern that the beneficiaries' assets will be mismanaged for any reason.
If you need help with probate, contact us today by calling (916) 343-8488!
Ways to Avoid Probate in California
Due to the costs and delays associated with probate, Californians often wonder if probate can be avoided. The short answer is yes, it can, but it depends upon how a person's assets are organized and the size of the estate. Deciding whether or not probate avoidance is right for you will require a careful review of your assets and your relationship with your beneficiaries.
Probate is necessary for transferring ownership of property owned solely in the decedent's name to their beneficiaries. However, probate can often be avoided by adjusting property so it is not held solely in your name.
Common ways to avoid probate include:
- Revocable living trust
- Payable-on-death accounts and registrations (e.g. bank accounts & retirement accounts)
- Life insurance with beneficiary designations
- Joint ownership of property
- Community property with right of survivorship
- Gifts
- Simplified probate procedures (for small estates)
Simplified Probate
In California, there is a probate threshold defining small estates, which can bypass the probate process. California Probate Code states that estates totaling less than $166,250 in assets are not required to go through probate.
It's important to remember that the simplified process cannot be used for real property such as a home. If the decedent left behind less than $166,250 in real property and some personal property, the executor will need to file a Petition to Determine Succession to Real Property with the court and file an Inventory and Appraisal.
Revocable Living Trusts
During your lifetime, you can be the trustee of your trust and be the sole beneficiary. You would name a successor trustee to take over upon your death, thereby avoiding the need for probate. Once you pass away, the successor trustee would distribute your property to your beneficiaries according to the instructions set forth in your trust.
Some people choose to avoid probate by making their children co-owners of their assets. However, if your child dies before you, gets a divorce, or have creditor problems of their own, your assets could be at risk.
Title Ownership
Certain types of property passes directly to beneficiaries because how the property was owned. Property owned in joint tenancy, community property with right of survivorship, and bank accounts owned by several people all pass to survivors. Therefor, these accounts are not subject to probate.
Beneficiary Designations
In some cases all or a portion of a decedent's property passes to beneficiaries because the contract names beneficiaries. Such contracts include life insurance policies that pay benefits to someone other than the estate, bank accounts with payable on death designations, retirement benefits, death benefits, and trusts.
Contact Us Today
If you were appointed as an executor or an administrator, you have a large responsibility on your shoulders and you should not proceed without legal representation. Probate is a complex process and something very easy for a seasoned attorney can be very confusing for the average person.
Since a personal representative can be held legally and financially responsible for any mishandling of an estate, you should protect your interests by seeking help. We can inform you of your rights and responsibilities, and navigate you through the probate process so you can perform your duties as seamlessly and efficiently as possible.
Contact our probate firm by calling (916) 343-8488 to schedule a consultation with Attorney Nick Yonano regarding your case!
