THE PROBATE PROCESS
What is Probate?
Probate is the court process transferring legal title of property from the estate of the person who has died (the "decedent") to his or her beneficiaries.
A Personal Representative’s duties in probate generally consist of the following, among other duties:
- Proving to the Court that a Will is valid,
- Identifying and collecting the decedent's real and personal property;
- Paying the decedent’s debts, taxes, and other obligations,
- Providing an accounting to the beneficiaries and heirs of the financial activity of the estate during administration, and,
- Distributing the estate’s property according to the terms of the Will, or to the decedent's heirs if no will exists.
Is Probate Necessary?
Probate may not be necessary if the decedent held title to real and personal property in joint tenancy with another, designated beneficiaries on financial accounts and real property, or created a living trust during their lifetime. If the decedent owned real and/or personal property titled in his or her name at the time of his or her passing, then probate will likely be required. It should be noted that there is a common misconception that creating a Will avoids probate. Wills are designed to inform the Court during probate of the decedent’s wishes, and therefore will require a probate to distribute the assets in the decedent’s estate.
The term “probate estate" refers to any property subject to probate upon a decedent’s passing. Property transferred to a surviving spouse, property held in joint tenancy or community property with right of survivorship, life insurance, and retirement benefits are all part of the decedent’s “non-probate estate,” which do not require probate to be transferred. However, one must be careful to examine how title is held to all assets and whether beneficiary designations are established to determine which assets, if any, are subject to probate upon the death of the decedent
Is Probate Required to Distribute Life Insurance and/or Retirement Benefits?
No, so long as the assets have valid beneficiary designations. Benefits from life insurance and retirement accounts can be paid directly to a named beneficiary. Money from IRAs, Keoghs, and 401(k) accounts transfer automatically as long as beneficiary designations are present. Financial accounts that are set up as pay-on-death accounts (PODs) or "in trust for" accounts with a named beneficiary may also pass to a beneficiary outside of probate.
Is Probate Required for Property in a Living Trust?
No, so long as the living trust is properly executed and funded. When a decedent's property is titled in the name of the living trust, that property also passes to the trust’s beneficiaries without probate. However, all of a decedent’s real and personal property not passing by beneficiary designation, joint tenancy, or community property must be funded in the trust. This requirement is met if the decedent transferred ownership of the real and personal property to the trust during the decedent’s lifetime. If the decedent did not complete this requirement, the real and personal property may be subject to probate to distribute the assets.
How Much Does Probate Cost?
The cost of probate is set by California law. Costs of probate may include appraisal costs, executor's fees, court filing fees and certified copies, costs of an executor’s bond, and legal and accounting fees. In all, probate can cost from 4% to 7% of the total estate value, sometimes more. Litigation or unexpected problems during probate may lead to additional fees and expenses during probate.
To determine attorneys and executor’s fees to probate your estate, use our convenient probate fee calculator.
How Long Does Probate Take?
Probate is a time-consuming process that often takes longer than one year. Depending on the complexity of the estate, court calendars, and other factors, a relatively straight forward estate can take twelve to twenty-four months to complete. If anyone files a contest during probate, the estate may take longer than two years to probate.
Who Administers a Decedent’s Estate?
If the decedent left a Will, the person named as executor will usually be appointed as the personal representative and will be responsible for administering the estate. The nominated executor may not act as personal representative until he or she is appointed by the court and formal "Letters Testamentary" are issued by the Court Clerk. This appointment occurs at the initial hearing. If another party objects to the appointment of the nominated executor, additional hearings will be required to appoint a personal representative, thus delaying the administration of the estate.
If the decedent left no Will nominating an executor, or the nominated executor in the Will is unable or unwilling to act, the probate court may appoint an administrator to handle the process. In doing so, the Court will likely appoint the decedent’s closest living relative, or an heir to the estate, to administer the estate.
Is Probate Required if the Decedent Owned Land in More Than One State?
Yes. If the decedent owned real property in more than one state, a probate will be required in the state or states in which the decedent’s real property is located. For this reason, a personal representative may be tasked with opening multiple probates in multiple states to administer all of the decedent’s real property. This can be avoided by creating a living trust and titling all of the decedent’s real property in the trust.
If the decedent left a Will, the terms of the Will will determine who receives the decedent’s real property. If the decedent did not leave a Will, the laws of each state in which real property is located will determine who receives the real property.
The personal representative should have good organizational skills and be able to keep track of details. It is preferable if he or she lives nearby and is familiar with the decedent's finances. This makes it easier to do tasks and find important records.