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INFORMATION ON PROBATE Please note - all information provided through this site has been taken from self-help publications and/or Informational booklets provided by the Court or authored by attorneys. This information is general, published, factual information and should not be cited on or relied on as legal authority nor should it be considered legal advice.

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FILING A FULL PROBATE PROCEEDING

Probate is a legal proceeding required to settle a deceased person’s estate, paying all debts of the decedent, and distributing the property to the heirs and beneficiaries. Probate proceedings are usually filed in the Superior Court of the county where the decedent lived or where the decedent owned property.
 

Previously, all estates had to be formally brought before a judge before assets could be distributed to the beneficiaries. In more recent years, however, the courts have simplified the process and now there are several ways to transfer property at death. Some of these procedures do not even require formal court proceedings. The term “probate” is often used loosely to describe any process where an estate is settled and distributed,

DO YOU NEED AN ATTORNEY TO PROBATE?

The law does not require you to hire an attorney to settle an estate. The average simple estate can often be settled using the guidelines of self-help materials and the services of a registered legal document assistant to prepare your paperwork.  Some complications that may require special knowledge or handling by an attorney are:

  • Ambiguities in a will
  • Contested claims against the estate
  • Estates that have more debts than assets
  • Estates that have unresolved claims

One advantage of handling estate work yourself is not having to pay attorneys’ fees. Attorneys’ fees have been set by law and are based on a percentage of the gross estate. These statutory fees are based on a formula found in California Probate Code §§10810 and 10811. An attorney may collect:

  • 4% of the first $100,000 of the gross value of the probate estate;
  • 3% of the next $100,000;
  • 2% of the next $800,000;
  • 1% of the next $9,000,000;
  • ˝% of the next $15,000,000; and
  • a “reasonable amount” as determined by the court for everything above $25,000,000.

For example, in a probate estate with a gross value of $150,000, the attorney may collect $5,500. If the estate was valued at $400,000, fees would be $13,000. The value of the estate is not reduced by any mortgages or debt that may exist. For example, if an estate consisted of one piece of real property worth $600,000 that had a $500,000 mortgage which reduced the decedent’s equity to only $100,000, the attorney’s fees would still be $15,000 based on the gross value of the estate.

Probate proceedings can be categorized into two different types, simplified probate procedures and regular probate. Simplified probate procedures are more fully explained below. To learn about simplified probate proceedings, click here.

FILING A COMPLETE PROBATE: Filing a full probate proceeding entails complete court supervision of the entire process to transfer legal title of property from the estate of the person who has died (the "decedent") to his or her beneficiaries. The process requires extensive paperwork and several court appearances.
 
There are several steps involved in the probate court process. It is necessary to:

  • Prove to the Court that the Will, if there is one, is valid (this is usually routine),
  • Appoint a legal representative with authority to act on behalf of the decedent,
  • Identify and inventory the decedent's property, and have that property appraised,
  • Pay debts and taxes, and
  • Distribute the remaining property according to the terms of the Will or to the decedent's heirs.

STEPS IN A TYPICAL PROBATE:

Step 1: In most cases, the person requesting appointment as personal representative (executor or Administrator) hires either an experienced registered legal document assistant or  probate lawyer to prepare and file a Petition for Probate.

Step 2:: The probate lawyer, or the legal document assistant, arranges to mail notice to everyone named in the decedent’s Will (when there is a Will) and all his/her legal heirs about the death and the probate hearing. The notice must also be published in the newspaper where the decedent lived to let creditors know about the hearing. Notice gives everyone notified an opportunity to object to admitting the Will and to the appointment of the personal representative.

Step 3: The hearing usually takes place several weeks after the matter is filed. The purpose of the hearing is to determine the validity of the Will and to appoint the personal representative. Sometimes, the Court will need the people who witnessed the decedent's signature on the Will to sign a declaration. If there are no objections, the court will approve the petition and appoint the personal representative.

Step 4: The personal representative must identify, take possession of, and manage the probate assets until all debts have been paid and tax returns filed. This process usually takes about a year.  Depending on the terms of the Will (if there is a Will), and on the amount of the decedent's debts, the personal representative may have to sell real estate, securities or other property.  For example, if the Will makes cash gifts but the estate consists mostly of valuable artwork, the art may have to be appraised and sold to produce cash.  Or, if there are unpaid debts, the personal representative may have to sell some of the estate property to pay them.

Step 5: After paying the debts and taxes, the personal representative must file a report with the court. The report accounts for all income received and payments made on behalf of the estate. The judge will then authorize the personal representative to divide the remaining property among the people or organizations named in the Will.

Step 6: The property will be transferred to its new owners.

If a person dies without a Will (known as dying "intestate"), the probate court appoints a personal representative (known as an "administrator").

The major difference between dying testate and dying intestate is that an intestate estate is distributed according to state law (known as "intestate succession"). A testate estate is distributed according to the instructions left by the decedent in his or her Will.

If a Will is lost or can’t be found, the specific facts and circumstances and state law will determine what happens. For instance, if the Will is missing because the decedent intentionally revoked it, an earlier Will or the laws on intestate succession would determine who gets the decedent's estate. If a Will is missing because it was stored in a bank vault destroyed in a fire, the probate court may accept a photocopy of the Will (or the lawyer's draft or computer file), if there is evidence that the decedent properly signed the original.  

Property that requires probate:The term "probate estate" refers to any property subject to the authority of the probate court. Assets distributed outside the probate process are part of a person's “non-probate estate.” For example, money from IRAs, Keoghs, and 401(k) accounts transfer automatically to the persons named as beneficiaries. Bank accounts that are set up as pay-on-death accounts (PODs) or "in trust for" accounts (a "Totten Trust") with a named beneficiary also pass to the beneficiary without probate. 

HOW LONG DOES THE PROBATE PROCESS TAKE?

California law says the personal representative must complete probate within one year from the date of appointment, unless he/she files a federal estate tax. In this case, the personal representative can have 18 months to complete probate.

If probate has not been completed by that time, the personal representative must file a status report to the court to explain what still has to be done and how much time that will take.

If the personal representative does not report to the court, the beneficiaries can ask the court to order him or her to file an accounting or take other actions to close probate. The court can remove the personal representative and appoint someone else.

Sometimes there are circumstances that can make probate take longer. If there is a Will contest (a claim filed with the court that all or part of the will is not valid), or the size and complexity of the estate requires extra time, or it is hard to find beneficiaries, the process can drag out. Some probate cases take years to resolve.

FILING THE PROBATE PROCEEDING: In California, probate hearings are in the Probate Department of the Superior Court in the county where the decedent lived at the time of his or her death.

If you have to file a probate petition in another state because there is real property in that state, the courts in that state may use a different name. In New York, for example, the probate court is known as the Surrogate Court.

THE EXECUTOR OR PERSONAL REPRESENTATIVE: :If there is a Will, the person named as executor will usually be appointed as the personal representative – this means he/she is responsible for managing the estate and following probate rules and procedures.

The executor has no authority to act as personal representative until he/she is appointed by the court and formal "Letters Testamentary" are issued by the Court Clerk.

if there is no Will, or if the Will doesn’t name an executor, or the person named as executor in the Will is unable to be executor or does not want to be executor, the probate court appoints someone called an administrator to handle the process. The Court usually chooses the closest living relative, or a person who will inherit some portion of the decedent's assets.  The executor or personal representative has a fiduciary duty to act in good faith and honesty during all aspects of the proceeding. Some individuals are not allowed to be a representative of the estate. This includes:

  • a minor,
  • a person subject to a conservatorship or otherwise incapable of performing the duties of personal representative,
  • a surviving business partner of the decedent, if an interested person objects (unless the Will names the partner as executor), or
  • a nonresident of the U.S. (unless the Will names the nonresident as executor).

The court does not generally supervise every aspect of the personal representative’s duties, however, the personal representative may require the Court’s permission to sell real estate or business interests owned by the estate. Furthermore, the personal representative cannot do any of the following things without the Court’s permission:

  • pay fees to himself or herself,
  • pay fees to his or her attorney,
  • make a preliminary distribution of property to beneficiaries (with a few exceptions), or
  • close the estate.

The personal representative may also be required to obtain a surety bond (an insurance policy that protects the estate beneficiaries in the event of the personal representative's wrongful use of the estate's property), even if the Will waives this requirement.

The Personal Representative has many duties. They are responsible to:

  • decide if there are any probate assets;
  • locate the decedent's assets and manage them during the probate process. This could take up to a year or longer and may involve deciding whether to sell real estate or securities owned by the decedent;
  • receive payments due to the estate, including interest, dividends, and other income (e.g., unpaid salary, vacation pay, and other company benefits)
  • set up an estate checking account to hold money that is owed to the decedent -- for example, paychecks or stock dividends;
  • figure out who is going to get what and how much under the Will. If there is no Will, the administrator will have to look at state law (Probate code Sections 6400 – 6414, called "intestate succession" statutes) to find out who the decedent's heirs are and determine each heir's share of the estate;
  • value or appraise the estate's assets;
  • give official legal notice to creditors and potential creditors of the probate proceeding and the deadlines for creditors to file claims, according to state law;
  • investigate the validity of all claims against the estate;
  • pay funeral bills, outstanding debts, and valid claims;
  • use estate funds to pay continuing expenses -- for example, mortgage payments, utility bills and homeowner's insurance premiums;
  • handle day-to-day details, such as disconnecting utilities, ending leases and credit cards, and notifying banks and government agencies -- such as Social Security, the post office;
  • file tax returns and pay income and estate taxes – including a final state and federal income tax return covering the period from the beginning of the tax year to the date of death;
  • after getting the court's permission, distribute the decedent's property to the people or organizations named in the Will, or to the decedent's heirs if there is no Will; and
  • file receipts for distribution and wrap up any closing details for the estate.
     

A personal representative may be held liable for:

  • improperly managing the assets of the estate,
  • failing to collect claims and money due the estate,
  • overpaying creditors,
  • selling an asset without the authority to do so, or at an inappropriate price,
    not filing tax returns on time,
  • distributing property to the wrong beneficiaries, or
  • distributing property to beneficiaries before all creditors have been paid, etc.

CREDITORS OF THE DECEDENT: Part of the probate process is to notify creditors of the death. Notice requirements vary. In some cases, you must provide direct notice. In others, you must publish a notice in a newspaper in the city where the decedent lived.

Creditors must file a claim with the court for the amounts due within a fixed period of time. If the executor approves the claim, the bill is paid out of the estate. If the executor rejects the claim, the creditor must sue for payment.

If there is not enough money to pay all debts, state law determines who gets paid first. The personal representative most likely will sell property to pay approved creditor claims.  Remaining claims are paid on a pro-rata basis.

ESTATE TAXES: For federal and state tax purposes, death means two things: It marks the date of the close of the decedent's last tax year for filing an income tax return, and It establishes a new, separate entity for tax purposes, the "estate." For federal taxes, you may have to fill out and file one or more of the following forms. (It depends on the decedent's income, the size of the estate, and the income of the estate):

  • Final Form 1040 Federal Income Tax return (the decedent's personal income tax return)
  • Form 1041 Federal Fiduciary Income Tax returns for the estate
  • Form 709 Federal Gift Tax return(s)
  • Form 706 Federal Estate Tax return
  • For California taxes, the executor must file any needed state income tax return, state fiduciary income tax returns during the probate period, estate tax and gift tax returns.

There may be other taxes, too, like local real estate and personal property taxes, business taxes, and any special state taxes.

The executor must also check for taxes owed for years prior to the decedent's death.

 

Filing Your Proceeding Using our Self-Help Services:

In view of the voluminous paperwork required by the court, preparing all of the necessary probate documentation can easily be overwhelming for the average lay person. For routine proceedings, this process can easily be facilitated with the assistance of a registered Legal Document Assistant .

Our services include the preparation and court processing of your court documents and scheduling of the required hearings. In addition, our office offers a comprehensive self-help library which is available to all clients during document preparation services performed in our office as well as a complimentary attorney-approved self-help booklet pertaining to your particular type of proceeding. To proceed with your document preparation, click on the link below.

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