When is Probate Necessary in California?
For this article, we refer to probate as the 8-10 month court process that settles a decedent’s estate. We are not referring to alternative simplified proceedings that we will discuss later in this article.
With this in mind, the first step to determine when probate is necessary is to figure out which assets are part of the estate. Assets that are part of the estate, must be transferred through probate. Assets that are part of the estate include:
- Assets titled solely in the name of the decedent. These assets may consist of real estate, bank accounts, valuable collectibles, and personal property. Most states, including California, have exceptions for vehicles. Another exception is accounts with a Payable on Death beneficiary or property with a Transfer on Death Deed. You should not count assets held in a revocable living trust as part of the estate.
- Property that the decedent owned as a tenant-in-common. There is an exception for a Transfer on Death Deed. However, property that is a joint tenancy with right of survivorship will not be part of the estate.
- Accounts with named beneficiaries, such as a retirement plan or life insurance. These accounts are usually not part of the estate. An exception to this would be if all the designated beneficiaries predeceased the decedent. In that situation, the account becomes part of the estate.
How to Determine Value of Estate
Once the estate representative figures out which assets are part of the estate, he/she must determine the total value of the estate. The value of the estate determines when probate is necessary in California and if an alternative process is an option. First, calculate the total gross value of the estate assets. Does the esate include real property? Next, eliminate all the exceptions discussed above. If, after eliminating all exceptions, the gross estate is valued more than $150,000 (and includes real property), then you must file probate. We urge you to watch this informative video which will help you understand the various options to settle an estate in California.
If the total value of all the California assets in the estate are under a $150,000, then most likely you can settle the estate by a simplified procedure. It is important to understand that beneficiaries can use a simplified procedure if there is a will or there is no will. To officially value the assets, California requires an appraisal from a probate referee. This valuation is part of the simplified procedure. If, however, the referee determines the value of the assets in the estate exceed this threshold, then probate will be necessary whether the decedent had a will or not.
When to Choose Probate vs Simplified Procedures
Even if the value of the assets in the estate qualifies the estate for a simplified procedure, there are situations when probate would be preferable over a simplified procedure. If the decedent’s will is flawed, you may need court intervention to decide the terms or validity of the will. If there are disputes among the heirs, it may be necessary to resolve the differences through a court process. If the decedent has a large amount of debt or the estate is insolvent, then probate may be necessary to determine which creditors have priority for payment. Lastly, some companies may refuse to transfer assets in some accounts unless the estate goes through full probate.
If you need to settle an estate, whether it be filing probate or a simplified proceeding, contact A People’s Choice. We have helped thousands of families settle a decedent’s estate. Our probate services are inexpensive and a great way to save thousands of dollars as compared to hiring an attorney. Reach out to speak with our experienced staff at 800-747-2780.
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