If we were to make a list of topics our clients ask us about most often, probate would be near the top. In particular, many of you want to know when a probate is necessary, and what steps are involved. These are not easy questions to answer. Every family’s estate is unique. So, too, are the relationships between family members: some families are in relative harmony, others have conflicting interests and long-standing resentments. In addition, the laws governing probate differ from one state to another, which poses a particular problem for families with assets in more than one state. That said, we can make some generalizations.
Generally speaking, an estate has to be probated if:
Assets are owned in the decedent’s sole name
If the decedent owned any property in his or her sole name, without any other owners or a payable on death or similar type of designation, then in most cases the property will need to be probated in order to get it out of the decedent’s name and into the names of the decedent’s beneficiaries. An exception in some states is a motor vehicle. Aside from this, some states have a streamlined process for “small estates” (anywhere from $20,000 to $100,000, depending on the state, circumstances and type of property) that takes significantly less time than a full probate administration.
Assets are owned as a tenant in common
If the decedent owned any property in his or her individual name as a tenant in common with others, then in most cases the decedent’s tenant in common share will need to be probated in order to get it out of the decedent’s name and into the names of the decedent’s beneficiaries. The “small estate” procedure mentioned above also applies to a tenant in common interest as long as the decedent’s fractional share is valued at less than the applicable state’s small estate cut off amount.
There are predeceased beneficiaries or no designated beneficiaries
If all of the beneficiaries named on an account or policy have predeceased the decedent, or if the decedent didn’t name any beneficiaries at all, then in most cases the account or policy will need to be probated in order to get it into the names of the decedent’s beneficiaries. Such accounts and policies can include: a payable on death or similar type of account; a Health Savings or Medical Savings Account; a life insurance policy; a retirement account, including an IRA or 401(k); and an annuity.
The decedent didn’t have a valid Will
If the decedent doesn’t have a valid Last Will and Testament at the time of his or her death and one or more of the situations described above apply to the decedent’s assets, then in most cases the assets will need to be probated.
The decedent has a valid Will
Even if the decedent has a valid Last Will and Testament at the time of his or her death, if one or more of the situations described above apply to the decedent’s assets, then in most cases the assets will need to be probated.
To learn more about probate in California, or for compassionate guidance in probating an estate, contact us for a consultation at (626) 696-3145 at your earliest convenience.
Tomorrow: We will discuss how an estate probated?
