The loss of a loved one is never an easy experience. It is a sad and challenging time for family, friends, and relatives. This is not made easier by the added burden of figuring out the meaning of probate in California. Now, what is probate?
To have estate assets inherited or transferred to you, you usually have to go to probate court. Dealing with the courts on these matters can, unfortunately, be challenging at times. There are some specific cases where estate assets and personal property can be transferred over to qualifying family members without following a court-supervised process. However, the main procedure that most go through in California is a formal probate proceeding.
Discovering the explanation on what is probate might not be fun, but it’s designed to protect the rightful heirs and the rightful beneficiaries. The formal administration process helps determine how to distribute the assets to beneficiaries. Depending on the complexity of the deceased’s will (or if there even is one, to begin with), the entire process can range from simple to painstakingly complex. No matter what the case may be, what is the probate process in California all about?
What Is Probate?
What is the best definition or and answer to that? What is probate? Simply put, probate is a court procedure that deals with the affairs of the decedent’s estate (the property that is left behind when a person dies). The term “decedent” refers to the person who died, while “estate” refers to the property they owned before their time of death.
This simplified procedure is established to ensure that the decedent’s real property and the various types of assets are transferred correctly and fairly according to a valid will. In the beginning, probate administration deals with determining if the deceased had a valid will. For an intestate estate (where no will is present), the process is more complex but is still considered probate. Here, intestate succession laws get applied.
What is Probate in California? The California Probate Process
Many people are surprised upon learning about the meaning of probate and how this legal process works. After assessing whether the decedent left behind a valid will, the simplified probate process determines who the decedent’s rightful beneficiaries and legal heirs are, along with the worth of the decedent’s sole ownership property and assets. Later on, during probate administration, the decedent’s property and assets are transferred to the legal heirs or beneficiaries. Probate administration also takes care of any outstanding financial duties (unpaid debts) of the decedent.
In a California probate case, the probate court judge designates an executor or estate administrator depending on the existence of a will. An executor is appointed if there is a will and an estate administrator is appointed in the absence of one. In either case, this person acts as a personal representative with the responsibility of handling financial duties, such as paying outstanding debts and expenses to relevant creditors and distributing assets to heirs. Other forms of expenses include;
- Administrative expenses
- Funeral expenses, and
- Medical expenses
The entire legal proceedings for probate can last from nine to eighteen months or longer, depending on the case and the complexity of the decedent’s will. These legal duties are all carried out under the supervision of the California court.
What Assets Are Subject to Probate in California?
When a person dies, they leave behind various types of property and assets, but not all of these are processed through California probate law. Certain forms of property can be excluded from California probate law and directly transferred to an individual depending on how it was owned by the decedent.
Let’s start with probate assets, or assets subject to probate:
- Homes, vehicles, jewelry, art, furniture, personal items, and many other belongings are subject to probate.
- Any form of real estate or personally owned property in the decedent’s name is subject to probate.
- Intangible assets that are subject to probate include savings and checking accounts, stocks, cryptocurrency, bank account funds, business ownership, and similar items.
Now for the assets that may be exempt:
- Any form of property that is not individually owned (joint assets) by the decedent is considered a non-probate asset and is not subject to California probate laws. The joint survivorship rights are adhered to in this case.
- Real estate can be considered a non-probate asset if it is under the care of joint owners with the right of survivorship.
- Assets such as banking accounts and life insurance policies/life insurance proceeds with a beneficiary allocation are considered non-probate assets due to a “pay on death” clause.
- Finally, any form of property that is owned by a living trust (trust assets) will not be subject to California probate law in the event of the owner’s death.
Do All Estates Have to Go Through Probate?
If an individual wishes for their beneficiaries to avoid the probate process upon their death, they can plan alternatives during their lifetime. In cases like this, the decedent’s property and assets are not subject to California probate laws.
However, this is not the norm. If the individual has not made any alternative estate planning, and if their estate is valued over the California threshold (more on that later), then going through the probate process is simply inevitable. Nobody has the authorization to transfer or inherit any property without taking part in a court-supervised proceeding. The only way to receive a court order is to go through the probate process. Sometimes, the decedent’s estate would be subject to probate even if an alternative estate plan gets implemented.
As mentioned in the previous section, there are cases where certain forms of property and assets can bypass this process. If property or assets are labeled as non-probate, they can avoid California probate law. This is true so long as assets and property have been integrated with a right of survivorship, named beneficiaries, and owned by a living trust. There is also the matter of the estate threshold; see the next heading for information on that.
However, the truth of the matter is that the majority of a decedent’s property needs to be probated before a probate judge. All forms of assets and property in the decedent’s estate that do not fall under a non-probate classification must be processed through California probate laws. These probate exclusions need to be presented to relevant beneficiaries and heirs once the owner has passed on.
What Is the Threshold?
In California, there is a threshold for probate, and estates that don’t meet that value threshold are exempt from the process. For those who have passed away before 1 January 2020, the California Probate Code dictates that decedent estates of $150,000 or less do not need to be subjected to probate. As of 1 January 2020, the California probate threshold was increased to $166,250. If the decedent’s estate contains property and assets that exceed the amount allowed, then the estate requires probate.
The threshold amount for a decedent’s estate is calculated by totaling the value of all owned assets. Be aware that assets and property that are labeled as non-probate are not included in this calculation.
The summary probate procedure applies to estates with personal property not exceeding the threshold amount. Decedent estates that are valued lower than the threshold amount are managed by composing affidavits. These affidavits are submitted to the various institutions that currently hold the assets. These assets are subject to the summary probate procedure. As you might imagine, this process is usually much faster and inexpensive than regular probate, even if it requires some court intervention.
What Happens If You Don’t File Probate in California?
Many people are surprised to find out that when a decedent passes, you are not obligated by law to file for estate probate. However, if you do not file for probate of the estate, you aren’t able to lawfully distribute or inherit any assets listed in the decedent’s estate.
If the decedent owned assets without appointing a beneficiary, then those cannot be transferred without court authorization through probate. Heirs or beneficiaries could be denied what they are legally entitled to if estate probate documents are not filed and the decedent had no will.
Issues with an existing will remain unsettled without probate as well. Sometimes, there is a problem with a decedent’s existing will, such as doubts about the decedent’s capacity to make decisions at the time of validation or the credibility of the signatures on the trust documents. These issues and only be solved through a simplified probate process.
Non-probate assets and property, or assets and property that alternative plans have been made for, will be distributed regardless of whether you file for probate. Even so, it is almost always worth filing for probate. Even if you decide to skip probate, it is crucial to file an existing will with the court. Otherwise, you could have criminal and court damages filed against you by those who would have benefitted from the decedent’s estate.
Get Help with Probate
Many people don’t know what is probate in California, but if you have been tasked with settling the estate of a deceased family member in the state of California, you will need to figure it out. Understandably, you may need assistance.
Most people immediately think of seeking the legal services of a probate attorney to assist them. However, before you do this, bear in mind that the attorney will receive statutory fees as compensation. These fees are generally high and are based on the overall value of the estate.
A legal document assistant can be an inexpensive and effective alternative. A legal document assistant like A People’s Choice can arrange all the necessary forms needed for the probate process. They generally charge a flat fee for the whole process.
Here at A People’s Choice, we offer low-cost assistance and high-quality service to help you settle probate efficiently. Our document assistants can’t give you legal advice, but they can ensure that you are not left in the dark and can, in most situations, avoid hiring a pricey attorney to settle an estate. If wrapping your head around the meaning of probate is proving a challenge, contact us today.