The probate process can be a daunting and overwhelming experience, especially for those who have never gone through it before. In California, as in many other states, probate is legally mandated in certain circumstances, but there are actually ways to avoid it for certain situations and particular types of assets.

Understanding The California Probate Process

Probate is a special court process that occurs after someone who owns property or holds financial assets dies. Probate involves a court authority overseeing the distribution of the deceased person’s assets, which includes:

• Assigning an administrator to oversee the process
• Cataloging and taking control of all assets
• Paying off debts or taxes owed
• Liquidating or dividing assets that cannot be readily distributed
• Ensuring that the remaining assets are distributed to the intended beneficiaries in accordance with the law and/or any relevant estate planning instruments filed during the decedent’s lifetime

Completing all of these steps can take time. In California, the probate process typically takes several months to complete, with cases regularly stretching out to 2 years or more, depending on the complexity of the estate, the disposition of the potential heirs, the quality of your legal help, and other factors.

The probate process does not begin in a courtroom but with the filing of a formal petition for the court to open a probate case. Once the court receives the necessary paperwork, it will then appoint an executor or administrator to oversee the distribution of the estate. This party is responsible for the actual process of gathering and inventorying all of the deceased person’s assets, paying off debts, taxes, or other liabilities held by the estate, and distributing any assets to all beneficiaries.

Understanding Which Assets Avoid Probate Court in CA

While probate is required in many cases (and attempts to circumvent the legal probate process can result in serious consequences), there are also several types of assets that can be kept out of probate proceedings fairly easily. Here are some examples:

• Living trusts: A living trust can be thought of as a cross between a will and a special bank account. This powerful tool can be used to protect all sorts of assets, like real estate, bank accounts, investments, personal property, and even your business interests, from heading to probate.
• Communal/marital property: If the decedent is married at the time of passing, all community marital property will typically pass to the surviving spouse rather than heading to probate court with the decedent’s personal, separately-held assets.
• Joint tenancy with right of survivorship: Assets held in joint tenancy will be passed to the surviving joint tenant(s) instead of going through probate, so long as right of survivorship is adequately established. An example would be an investment property co-owned by two unmarried business partners but has right of survivorship established in the joint ownership contract.
• Assets with pre-existing beneficiaries: Assets and accounts that already have designated beneficiaries, such as life insurance policies, retirement accounts, and any account with payable-on-death (POD) terms, can also pass directly to the named beneficiary without involvement by the probate court.
• Low value estates: More modest estates can actually avoid probate altogether. California maintains a minimum value threshold for which estates must enter probate, which avoids the probate court dockets getting clogged with cases for which there are no assets to be distributed.

If you are unsure how to protect your estate from undue interference by the probate court, it is recommended to work with an experienced estate planning attorney to determine the right approach to meet your individual circumstances.

The Potential Dangers of Failing to Properly Open a Probate Case

While it’s true that probate can be tedious and expensive, the results of trying to circumvent probate without the proper legal tools in place can be far worse. Remember, probate is not optional; it is required by California law. Failing to properly engage with the probate process can result in serious consequences:

• Delayed distribution of assets: Even when an estate goes through probate fairly smoothly, the distribution of assets can take several months—even years.
• Increased costs: Probate can be a costly process, with fees and expenses that can eat away at the estate’s value the longer the case lingers, and this only becomes worse when you draw the process out through futile attempts to keep assets out of court.
• Family disputes: It’s true that probate court itself can sometimes lead to family disputes over the distribution of assets, which can strain relationships and cause emotional distress, but these issues can be exacerbated if one party is attempting to circumvent the process.
• Legal and criminal liability: Relevant parties, such as executors or administrators, who do not properly carry out their duties in probate court can be held legally liable for any losses or damages that result.

The California probate process can be a complex and time-consuming experience. We have great empathy for anyone facing it and look forward to offering you comprehensive estate planning strategies for minimizing the assets that will go into probate court upon your passing. However, it is also important to understand that probate is crucial and necessary in many cases to ensure that assets are distributed properly and that your heirs are not taken advantage of.

FAQs

Q: What Happens if Probate Is Not Filed in CA?

A: If the probate process is not filed correctly in California, it can result in delays, added costs, and even legal liability. The court may reject an improperly filed petition, resulting in frustration for the parties trying to access their inheritance.

Q: How Do You Avoid Probate in CA?

A: There are several effective ways to keep assets out of probate in California, including:

• Establishing a living trust
• Gifting assets to beneficiaries during your lifetime rather than including them in your estate plan
• Establishing important assets as joint marital property
• Properly designating beneficiaries for retirement accounts and life insurance policies
• Owning property or holding accounts jointly through contracts that include right of survivorship
• Including payable-on-death (POD) and transfer-on-death (TOD) clauses for accounts and other financial assets

Q: How Much Does an Estate Have to Be Worth to Go to Probate in CA?

A: Currently, a Californian’s personal estate must be worth more than $184,500 in total to require probate. However, if the decedent owned any real estate in their own name, probate will automatically be required—even if the estate has significant debts and is worth less than $0 in total. Note that the value of an estate is calculated by adding the total current worth of all assets held solely in the name of the deceased at the time of their death.

Sweeney Probate Law – Estate Planning Strategies to Protect Your Assets from Probate

If you have questions or concerns about the California probate process, Sweeney Probate Law is standing by to help. We are proud to help clients all over California protect their funds, their legacies, and their families. Our experienced team has helped countless individuals navigate the complexities of California’s probate system, and we are committed to providing compassionate, personalized legal guidance to help you achieve your goals and protect your loved ones. Contact us today for help.