What is Probate?
Probate is a legal process for all estates valued over $184,500 (including real estate) when the property or assets are not held in trust. Simply put, a court case must be initiated in order for the State of California to determine several factors, including, but not limited to:
- Does a Will exist? Is it valid?
- Who are the rightful heirs and beneficiaries to the deceased?
- How much is the decedent’s property worth?
- What financial obligations must be first addressed?
- Probate cases often take several years to settle. Meanwhile, ALL PROPERTY AND ASSETS ARE FROZEN. That means any real estate in the name of the Deceased can’t be sold until the Probate is completed.
- The cost of Probate is approximately 6% or more of the total value of the estate, and that’s if there are no disagreements or other issues that frequently arise. In a case where an individual owns a home valued at $1,000,000 and has $100,000 in liquid assets the cost to the estate would exceed $65,000.
- Probate is a public court case where all your personal and financial affairs are made available to the general public.
Who Gets My Stuff?
A complete Will & Trust package gives you the freedom to distribute your assets to whom you choose, how you choose to do it, at any time of your choosing. In California, if an individual dies intestate (without a will or trust) and owns a home, the entire estate enters into a process called Probate.
Who Cares for Minor Children?
If you die without a Trust, the State of California will determine who will care for your minor children. For most people, the idea of putting their children through that additional trauma and possibly having them be placed in the California State Foster Care System after the crisis and trauma of a parent’s death, seems downright inhumane.
- Clearly designate who YOU want to be long term guardians of your minor children
- Keep children out of temporary foster care during an already traumatic crisis
- Allocate resources for their long term care
- Protect their inheritances
What if I Become Incompetent?
According to a recent study by the NIH, adults reaching 70 years of age have approximately a 30% chance of suffering from dementia, losing the capacity to make decisions for themselves. Including other physical disabilities, adults living past 80 years of age have up to a 74% risk of incapacity or incompetence during their lives.
Who Will Make Critical Healthcare Decisions?
Common law dictates that individuals possess autonomy and self-determination until the point of discapacity. Competency refers to the mental ability and cognitive capabilities required to execute a legally recognized act, rationally. So if we become irrational or discapacitated, what happens then?
What Happens When I Die?
When someone dies with a Trust, there will be no Probate. However, specific legal requirements must be addressed quickly for the estate to be settled with no delay in distributions.
- Scheduling a meeting with an Attorney who will provide a comprehensive review of all Trust documents, answer questions and provide guidance to the Successor Trustee through the process.
- Filing of the original Will with the probate court in the county where they died.
- Providing proper notification to the Department of Health Care Services.
- Notifying the Franchise Tax Board (if necessary)
- Preparation of Affidavit of Death to transfer a California property
- Preparing a new legally-acceptable Certificate of Trust for the Successor Trustee.
- Preparation and mailing up to five statutory notices and copy of the trust to all beneficiaries
- Obtaining a new Tax ID for the Trust
- Creating one Small Estate Affidavit, as necessary