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CALIFORNIA PROBATE AND ESTATE ADMINISTRATION FAQ
Frequently Asked Questions About Probate and Estate Administration
Click Here for the ESTATE
PLANNING FAQ
DISCLAIMER: Merwyn J. Miller is licensed to practice in the State of California
only. Our office is located in Encinitas,
(San Diego County) California. (Encinitas is adjacent to the following
communities: Cardiff, Carlsbad,
Del Mar, La Costa, Leucadia, Oceanside, Rancho Santa Fe, San Marcos,
Solana Beach, and Vista.) [See our SERVICE AREA]
The
information provided in this FAQ page is offered for informational
purposes only; it is not offered as and
does not constitute legal advice. Mr. Miller does not seek to represent
you based upon your visit or
review of this Web page set. You should not make legal hiring decisions
based upon brochures,
advertising or other promotional materials. As you read this FAQ, keep
in mind that the answer to any
given situation could change drastically with only a small change in
the facts. Therefore, do not rely
upon these answers to solve your or someone else's problem. Instead,
seek competent professional
assistance.
Important note: Keep in mind that the following answers are based on California law
and practice and may or may not be
applicable to people and cases located in other states!
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What is probate?
"Probate" is more properly referred to as "estate administration"
and is the administration of the estate
of a decedent through court proceedings. It is the method by which the
rights of all parties are
determined relative to the decedent's estate. These parties would
include heirs (those entitled to inherit
by state law in situations where no Will exists or the Will does not
cover all assets governed by the
Probate Court), Will beneficiaries, creditors, and taxing authorities.
The proceeding effectively passes
title to assets of a decedent to those entitled to them.
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Who can
start a probate?
Most people are surprised to find out that any "interested" person
can commence a probate proceeding. This includes creditors, close
family members (as defined), heirs, or anyone having a claim against
the
estate of the decedent. See Calif. Prob C. §8000
and 48
(scroll down to section 48).
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Are there "estate administrations" which do not
go through the court?
There are always loose ends to tie up when someone dies. Whether a
Living Trust is used or not. Out of
court estate administrations are often used to tie up these loose ends
when a court proceeding is not
required. This would be the case where all assets of the decedent are
either titled in joint tenancy, titled
in a Living Trust, or have specified beneficiaries tied to the asset
(i.e. life insurance, bank accounts with
"pay of death" beneficiary designations, IRA's). Out of court
proceedings generally deal with all the
same issues as a Probate does, but the court is not involved.
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Are there simplified procedures for small
estates that are subject to Probate?
The California Small Estates Procedure can be used for relatively
small estates. This procedure is
available where less than $100,000 in non-real estate assets exist that
would normally be subject to
probate proceedings. Where no real property is involved no court
proceeding is required. There are also
some simplified procedures available where California real estate is
involved and the gross fair market
value of the personal property and real property is less than $100,000.
However, some court involvement
(although much less than a full Probate) will be required.
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Why do I want to have an estate administered?
I guess if all the decedent owned was furniture, nothing really
needs to be done for the beneficiary to
enjoy the asset. But if there are assets that have a formal title, then
something must be done to change
that title into the beneficiary's name. If no action is taken, then the
beneficiary will not be able to access
the bank account, sell or refinance the real estate, or get the benefit
of the securities portfolio.
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Are there any advantages to a probate?
What some people consider an advantage others may consider a
disadvantage. With a probate, creditors
generally have four months to file a claim. In situations where no
probate is commenced, creditors
generally have up to a year. Most people typically consider the shorter
period to be better for the
beneficiaries of the estate. Additionally, with a probate, the
beneficiaries wind up with a court order at
the end of the day. This court order states what they have inherited.
This is not typically true for out of
court administrations. The court order can be valuable where arguments
or title claims are a concern.
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How much does a probate proceeding cost?
Probate costs in California are determined by a statutory formula.
Here's the link to my probate cost
schedule.
The actual statutory formula is a little bit complex. However, for
ease of approximation, a simplified
formula can be used. It works for probate estates with a value between
$100,000 and $1 million. It is 2%
of the probate estate value + $3000. That sum would be the statutory
fee for the attorney and the
executor would receive an identical sum. There are also court costs and
probate referee fees but they
are typically relatively small. Taxes, of course, can also be an
expense but these would be due whether
an in court administration (probate) or an out-of-court administration
were used. Extraordinary fees are
also a possibility for either the attorney or the executor if either
does anything outside the "ordinary"
services. But, presumably, this would also be charged if an
out-of-court administration were used.
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How much does an out-of-court administration
cost?
See my FAQ page for Estate
Planning Question #10.
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When does the attorney get paid with a probate?
Attorney fees (and executor fees) are generally paid toward the end
of the case and only after a court
order approving them. Fees are different than reimbursement for costs.
Costs are often reimbursed
periodically during the case.
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When does the attorney get paid with an
out-of-court administration?
In our office, we generally take a retainer at the front end of the
case.
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How long does an administration take, Probate
or non-Probate?
Estates of more than $1,500,000 with a Living Trust typically take
10-12 months to settle. If just a Will
were used, Probate is very often required to settle the estate and this
court process will typically take
15-20 months. In smaller estates with a Living Trust, 4-8 weeks used to
be typical. Unfortunately (or
fortunately), depending upon how you look at it, the California
legislature passed a law requiring all
trust beneficiaries and heirs of a decedent to be sent a specific
notice and giving them four months (but
in certain cases 6 months) to contest the trust. So now, it still
generally takes 4-8 weeks to complete the
substantive efforts to settle the estate, but the estate must stay open
until the contest period has run its
course. If Probate is required 10-14 months is fairly standard. All of
this process is referred to as "Estate
Administration."
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Is the court ever involved with an
out-of-court administration?
Court intervention can be requested at any time during the
administration and can be done on a "piece-meal" basis. In other words,
just because you request a court ruling on one aspect of the
administration
does not mean you are stuck with the court for the entire
administration.
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Why can't an estate which doesn't involve
probate be closed immediately?
As stated above, there are always loose ends to tie up. I have heard speakers
(although not attorneys)
say that they typically settle an estate where a Living Trust was used
in 30 minutes. That sounds great
but it just doesn't make sense. First, in California, by statute, there
is a four month settlement period
during which the estate has to be held open. This allows time for any
disgruntled heirs to challenge the
Trust on the basis of fraud or whatever other grounds might be
available. Now, you may not agree with
the rationale for this but our system of justice is based on giving
everyone an opportunity to state their
case and bring in the court to make a ruling. From that perspective,
allowing a four month period for
people to take that action makes sense. Second, where estate or income
taxes are due, one would want
to pay these as late as possible so they can retain the money for as
long as possible. Both of these points
argue against settling all but the most minimal estates in 30 minutes.
There are also other reasons but
these two illustrate the point rather well.
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What is the Probate tax?
There isn't any. What people are referring to when they use this
term is attorneys fees and court costs.
See above.
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Am I required to have an attorney for Probate?
No. You also are not required to have an attorney defend you in a
criminal case. But it's generally a
good idea in both situations. First, and at the most basic level, you
will need to figure out whether a
Probate is required and what forms need to be filed with what court. If
you are willing to put in a little
effort, you probably can do this. The forms issue and which court
requires which forms in what order
can be quite frustrating but it is what I consider the "paper pushing
aspects" of the case. You can, of
course, find paralegals advertising in the yellow pages or newspaper
who will offer to assist you on this.
More importantly are a myriad of other issues. Some of these issues
might involve taxes, creditors, and
how distribution will be made where more than one beneficiary exists.
For example, assume there is a
house and a bank account and the bank account is worth $50,000 less
than the house. There are two
beneficiaries. Beneficiary #1 wants the house and beneficiary #2 wants
the bank account. How can you
deal with that issue while keeping the county property tax from
increasing due to a proposition 13
"change in ownership"? These are some of the areas where having an
attorney becomes invaluable. See my FAQ page for Estate Planning
Question #21 on the Difference Between a Typist, a Paralegal,
and an Attorney.
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Do I need an attorney for an out-of-court
administration?
See my answer above
except the "forms" issue tends not to be as big an issue since
you're not dealing
with the court.
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In what state should the probate take place?
This is a much more complicated question than it appears. Generally,
the "home" probate (what's called
the domiciliary probate) takes place in the state where the decedent
resided at his death. Since a court
in one state generally can't issue orders affecting title to real
property in another state, a court
proceeding needs to be started in the state where the real property is
located. This is called the ancillary
probate. So there could be more than one probate proceeding going on at
the same time. That usually
means more than one attorney (because often attorneys only practice in
one state) and more than the
usual fee.
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In what state should an out of court
administration take place?
There are situations where the decedent died residing in one state,
real estate is located in another state,
the Trust was written in a third state, and beneficiaries live in a
fourth state. This is what is called a
multi-state trust. Again, this is a complicated question. But usually,
the rules of the state in which the
decedent resided at death are the ones that are followed although the
other states' laws may have to be
considered depending upon the circumstances.
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What do you do when a loved one has died?
I have a free
download to a book on our sister website that I wrote that answers
this question and gives
you a step by step approach as to what to do at the outset.
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How many death certificates should one order?
I have a free
download to a book on our sister website that I authored that
answers this question and
many more.
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How Can One Find A Competent Estate Administration Attorney?
In those states, such as California, where qualified organizations
have certified attorneys as specialists in
the estate administration field (See explanation of
the California Certification program), that
organization can be contacted. In other states or where no certified
specialist attorney is available in the
locale in question, one can contact one of the larger commercial banks.
These banks generally have
Trust Departments. (The old savings and loans, most of which are now
banks, do not usually offer this
type of service.) The local branches can usually provide the Trust
Department phone number (although
sometimes the teller may be unaware of this division of the bank). Ask
the phone operator at the Trust
Department to connect you with one of their Trust Officers. Ask the
Trust Officer for a referral to a local,
competent estate administration attorney. These officers have constant
contact with attorneys in the
local community and should know who is competent. Do keep in mind that
there are two types of Trust
Officers. A marketing trust officer and an administrative trust
officer. Either can probably give you the
necessary information but the marketing officer will probably have more
attorney contacts.
In my mind this method for finding a competent attorney is superior
to lawyer referral services (LRS).
With any LRS you never know what qualifications have been required of
its attorneys and you typically
are referred to whoever is next on the list (whether super qualified or
only marginally competent).
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Questions To Ask To Determine If An Estate Administration Attorney Is
Really Competent
Inquire about the attorney's credentials: Does he or she have any
specialized education? Keep in mind
that all California attorneys must take 25 hours of continuing
education every three years to maintain
the license. So ask what the titles of the courses were to determine if
the courses were relevant to estate
administration.
Does the attorney teach courses in the estate administration law
field? Teaching is a great method to
keep up to date.
Will the client actually be interviewed by and consult with the
attorney who attracted attention in the
first place, or will an associate attorney whom you do not know and/or
have not had an opportunity to
investigate handle the matter? Is the attorney who will service the
client fresh out of law school with
limited experience? ASK FOR THE NAME OF THE ATTORNEY WHOM YOU WILL
ACTUALLY SEE
AND THE YEAR IN WHICH HE OR SHE GRADUATED FROM LAW SCHOOL. Many people
feel that a
person must have been out of law school a minimum of 5 years before the
legal academic knowledge has
been matured by sufficient practical experience. Some people feel even
longer is necessary.
Many people think these are great questions but they would simply be
too embarrassed to ask them. If
you can't see yourself asking these questions, you don't have to.
Because the State Bar of California
already has through its board certification specialty program. (See explanation of
the California
Certification program) . So if you'd be too embarrassed to ask this
series of questions, just ask one: Ask
the attorney if they are a board certified specialist in the field of
Estate Planning, Trust, and Probate
Law (This is the field that covers estate administration.)
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Does It Matter If the Attorney Has His Main Office In Another City?
for a complete discussion of this topic, see Question
#19 on our Estate Planning FAQ page.
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What is your approach to handling estate
administrations?
We adhere to a team
approach with the client and the client's other professional advisors.
See my page
on Working with
Professional Advisors
Basically, we want you to
know that you are not "on your own." You probably have not been through
anything like this before, so it's easy to get overwhelmed. We've been
handling estates for almost 30
years and have developed a system which breaks down everything into
bite sized pieces. The result is
that there is less chance that you will get overwhelmed. Our goal is to
guide you step by step to solve the
problems in the least expensive and quickest manner. In the long run we
are attempting to save you
money and heartache from death/gift/income tax or other expense
perspectives and to keep the process
running smoothly to completion.
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DISCLAIMER: Merwyn J. Miller is licensed to practice in the State of
California only. Our office is
located in Encinitas, (San Diego County) California. (Encinitas is
adjacent to the following communities: Cardiff, Carlsbad, Del Mar, La
Costa, Leucadia, Oceanside, Rancho Santa Fe, San Marcos, Solana
Beach, and Vista.) [See our SERVICE AREA] The information provided in this FAQ page is offered
for informational purposes only;
it is not offered as and does not constitute legal advice. Mr. Miller
does not seek to represent you based
upon your visit or review of this Web page set. You should not make
legal hiring decisions based upon
brochures, advertising or other promotional materials. As you read this
FAQ, keep in mind that the
answer to any given situation could change drastically with only a
small change in the facts. Therefore,
do not rely upon these answers to solve your or someone else's problem.
Instead, seek competent
professional assistance.
Top of Page
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