As a popular saying attributed to Japanese writer Haruki Murakami goes, “death is not the opposite of life but a part of it.” That brings to mind the fact that although death can stop a person from living, it can’t stop the person’s legacy from thriving. This, is related to the far less poetic, but absolutely related question: what is probate estate?

In a bid to leave a good legacy behind, a lot of people try to leave something for their survivors. It is such property that is subjected to probate. This is the reason why people plan and prepare wills—to ensure that their belongings are inherited by people who will value and preserve them.

When a property owner dies, their assets are put under probate. This type of property is therefore called a “probate estate.” In this article, we will delve further into the question, “what is probate estate?”, how it relates to estate plans, and what activities take place when probating an estate.

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After The Estate Owner Dies, What Happens to Their Probate Estate?

The assets and properties of an individual can be called an estate. The estate of a deceased individual that is liable to administration during the probate process is called a probate estate.

The death of individuals leaves their assets and properties ungoverned. When an individual dies, whether with a will or without a will, their assets will have to be administered according to their wishes and the state laws. This legal process ensures their properties are distributed to the rightful beneficiaries at your time of death. The process of administering the deceased person’s estate assets, settling their debts and bills, and distributing their personal property to the right beneficiaries is referred to as the probate process.

Leaving behind a will prevents property from becoming an intestate estate that is distributed through intestate succession. Without a will, a person’s last wishes cannot be carried out and intestacy law goes into effect. This generally makes everything more difficult, so it’s best to plan ahead.

Avoiding Probate

A legal representative is known as an executor who files forms with the county clerk in order to fulfill these actions. However, it is pertinent to note that not all properties are subject to a probate procedure or a formal probate proceeding. Some properties are distributed outside the probate process and referred to as non-probate estate. You’ll learn more about that later in this article.

Also, in California, there are simpler processes used to distribute real property in estates that are worth less than a certain amount (depending on the type of property). This helps solve the cost of a legal proceeding, which can sometimes range in thousands of dollars. There are also easy, planned ways through which a deceased person’s belongings and estate assets can be transferred to their survivors such as joint tenancy, community tenancy with right of survivorship, and life insurance and retirement benefits. Again, we will go over some of these later in the article.

What Is Probate Estate Made Up Of?

To recap, a probate estate is made up of all the assets and real property an individual owns at the point of their death that are subject to administration in the probate process. There are many types of assets that qualify to be grouped into a probate estate.

Many times, these assets include real property (like houses), bank accounts, a federal income tax return, life insurance proceeds, investment accounts, testamentary trusts, a revocable trust, and more. Below, we’ll highlight the types of assets that make up a probate estate.

  •  Assets that were held in the deceased individual’s name alone
  • Assets owned in joint tenancy with other people
  • Assets or properties payable to the estate, such as life insurance or employee benefits
  • Assets or properties owed to the deceased individual before their death but paid after their death
  • Assets or properties due to the deceased person’s estate because of their death
  • Personal property or assets like objects, automobiles, and jewelry as well as other items that have no title

As highlighted above, assets subject to probate administration are duly supervised by the probate judge in the decedent’s county. This excludes real estate, which must be probated in the county where it is located.

What Is Probate Estate in California? 

You know now that probate is the process in which the court monitors or supervises the administration and distribution of properties from the estate of a deceased person to their stipulated or rightful beneficiaries to ensure compliance with the state’s probate laws. It is right to say that probate in California is not so different from probate in other states, but there are some key factors to keep in mind.

Although probate in California is significantly less complicated than most states, it is worthy of note that it can also be a little more expensive than most states. California is, after all, a fairly pricey place to live. Some of the factors that could make probate expensive include attorney fees, executor fees, and creditor notice fees. However, California probate laws allow for simplified procedures for real estate property below a certain amount.

There are also easy ways to circumvent some of the costs of probate. These include a revocable living trust, joint tenancy, and community property with the right of survivorship as well as a life insurance company and retirement benefits. These can make it a lot easier to boycott the stress of probate.

When Is Probate Unnecessary in California?

Probate isn’t necessary for two scenarios. First, if the deceased person doesn’t have any assets that are subject to the probate court’s authority, you can skip probate. Second, when the deceased person does not have any assets that may need estate administration, probate isn’t required.

Remember, assets subject to probate include tangible property such as cars, jewelry, real property, furniture, and intangible property such as cash in a bank account, estate funds, stocks, and bonds. However, probate is not necessary if certain plans and provisions have been made by the decedent before their death regarding beneficiary designations. Assets not subject to probate may include retirement accounts, life insurance policy (s), and brokerage accounts. These plans or provisions as mentioned earlier will be explained below.

  • Revocable Living Trust: This is a fiduciary arrangement that grants a third party or trustee the exclusive rights to hold assets on behalf of a beneficiary. In a revocable living trust, the beneficiaries can access the assets bequeathed to them more quickly than a will would allow. This makes probate unnecessary.
  • Joint Tenancy and Community Property with Right of Survivorship: In the legal procedure of joint tenancy and community property with rights of survivorship, probate is unnecessary. This is because a document is prepared before the death of the decedent. The document states how the decedent wants to hold their property with the beneficiaries when they are no more, which makes the beneficiaries able to take over ownership as soon as they die without having to go through the probate process. The document will also contain a list of people to benefit from the arrangement. Therefore, the community property laws apply in this case.
  • Life Insurance: In life insurance policies as well as other benefits that are payable on death, there is normally a transfer on death deal that has been documented. The decedent would have, before their death, stipulated the beneficiary to whom these benefits would be transferred. These funds go directly to the person subject to the policy with no need for a probate court proceeding.

These are the circumstances and provisions or arrangements that deem the probate process unnecessary (including the availability of non-probate property). It is safe to say that in every other circumstance aside from the aforementioned, probate is necessary and important in the administration of a decedent’s property to beneficiaries.

How Much Does an Estate Have to be Worth to Go Through Probate?

There is one more scenario under which probate isn’t necessary: the estate has to be worth a certain amount. Most states allow the provision of a simpler process for smaller estates. The required amount an estate must be valued at to go through probate varies from state to state. These simpler processes usually have different terms in different states, but they generally mean the same thing, which is a somewhat informal version of the probate process.

In California, an estate must be worth more than $150,000 to be required to go through probate. If the estate value is below that amount, there are other processes that the estate can go through which are generally simpler than the probate process. This makes things easier for the personal representative and generally shortens the overall timeline.

Why Might Probate Be a Good Idea, Even When Not Required?

In the case of not having any property to transfer or larger estates, the survivors of the deceased person may still decide to open probate. This is because probate can settle outstanding debts, estate taxes, or a personal income tax return that may have been owed by the deceased before their death.

Estate beneficiaries can also choose to file probate if the survivors of the deceased person with no transferable assets feel the need to set a time deadline for the deceased person’s creditors to file valid claims. In this case, the person in charge has to make a notice to creditors to settle estate debts. If no will is available, an estate affidavit can also be used to determine the nature of property distribution.

What Is Probate Estate Worth to You?

We hope you find this article helpful in answering some questions you have in your mind about a probate estate and the entire probate process in California. Should you need more information and legal advice on this topic, feel free to go through our other posts on probate in California from A People’s Choice.

At A People’s Choice, we have experts on standby that are ready to answer your questions and help you with your legal document needs. Whether you’re a personal representative or just need more help, contact us today for any form of legal document assistance! We can help you get the job done right by identifying all the forms you’ll need and helping you complete them correctly and efficiently, all for the fraction of the cost of an attorney.

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