Probate

Ancillary Probate in California

Published on: September 25, 2015 | by Burt + Clerc

We frequently get calls from beneficiaries wanting to change the title to California vacation homes. They already have a probate process in another state and merely need help “transferring title.” However, transferring title to real property after the death of an owner is usually not a simple process. If there is no joint tenant on the property, and the property is not in a Trust, a probate will be required to transfer title to the heirs or beneficiaries of a Will.

An ancillary probate is a probate proceeding for a decedent who was a resident of another state or country. This comes up frequently when residents of another state have a vacation home in California worth more than $150,000. In this case, there will be a primary probate in the decedent’s home state and then an ancillary probate in California. Unfortunately, the distinction between a primary and ancillary property is merely semantic. The same rules and procedures must be followed for an ancillary probate as they would for a primary probate. This means the process will take a minimum of four months, requires a formal petition and at least two hearings, the property must be inventoried and appraised and a publication must be made in a local paper.

An ancillary probate can be avoided if the property is in a Trust. An uncomplicated trust set up in California funded with the California real property will allow a much simpler transfer of title to that property. Furthermore, even a Trust set up in another state can hold real property in California.

Estate Planning Lessons from the Rich and Famous

Published on: March 10, 2014 | by Burt + Clerc

Some celebrity estates are embroiled in the media and legal battles while others remain private and relatively peaceful. Here are some lessons learned from the estates of the rich and famous.

Fund Your Revocable Trust

Recently deceased Paul Walker set up a trust for the benefit of his minor daughter. However, he failed to fund it so it will eventually be funded under the terms of his pour-over will when the probate is closed. His will and his reportedly $25,000,000 in assets is now public record through the probate court proceedings in Santa Barbara, California.

Why You Should Not Hold Property in Joint Tenancy with Your Children

Published on: April 22, 2013 | by Burt + Clerc

Our Palm Springs Estate Planning attorneys have clients who frequently ask about putting their children’s name on their real property deed. The assumption is that this will avoid probate and will also avoid the necessity for a living trust or other complicated estate planning documents. However, this technique is usually a bad idea.

Minor Children
Except under very limited circumstances, minor children should not own real property. A minor cannot execute legal contracts and thus it becomes extremely problematic when you want to mortgage, sale or rent real property that is jointly owned with a minor.

Creditors
When you own property with your children then the property becomes part of their estate. This means that any creditor of your children’s estate can attach liens and judgments against this property. Although your child may not have any known creditors beware of the unknown creditors. What happens if your child is at fault in a car accident? The creditor in this scenario can attempt to attach a lien or judgment against the property.

Joint Ownership
You may have transferred part of the property to your child just to avoid more complicated estate planning documents. However, now your child actually owns a piece of the property. This means that you will need their written consent to sale, mortgage or rent the property.

Predeceased Children
No one wants to contemplate that their child may predecease them. Unfortunately, this does occur. Also, many families travel together. If you and your children die simultaneously now the property must be probated but it will be a mess. The child’s ownership interest and your ownership interest must go through separate probate cases.

Gifting Concerns
The minute you put your child’s name on your deed it is as though you just gifted to them a portion of the property. If the value of the gift is over $14,000 you will be required to file a Gift Tax Return. Although you probably will not owe any taxes on this gift transfer, you are still required to file the return.
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What is a Trust and do I need one?

Published on: July 9, 2012 | by Burt + Clerc

A Trust is a written document that directs where your assets go when you die. However, unlike a will, a trust is a private instrument that does not require court intervention. If you have a trust you will avoid the court directed probate process and your estate can be administered privately and promptly.

Traditionally, trusts are used as probate avoidance techniques. However, Trusts are also beneficial for individuals wanting to have more control in the distribution of assets. Assets are distributed outright when they are distributed through probate, beneficiary designation or pay-on-death. A trust can instead provide that assets remain in trust until a beneficiary reaches a certain age, accomplishes some goal or indefinitely.

Trusts are especially helpful, yet overlooked, in the case of parents with young children. Many parents with minor children may still be establishing a career and may not be as financially secure as other adults. They may believe they do not have assets that warrant establishing a trust. However, they usually have substantial life insurance policies. Naively, the beneficiary designations on these policies generally lists the spouse first and then the children. The problem with this beneficiary designation is what happens when both parents die while the children are still minors? In this scenario, the life insurance policy will retain the proceeds until the children reach the age of 18. During the child’s minority, his or her guardian will not have access to these funds to care for the child. Additionally, the child will get the entire proceeds of the policy upon his or her 18th birthday. To avoid designating your minor children as the life insurance beneficiary, you can name your trust as the beneficiary after your spouse. This allows the trust provisions to designate when, where and how the proceeds are distributed.

Palm Desert Probate Attorney discusses the definition of Heirship

Published on: June 4, 2012 | by Burt + Clerc

Until recently, it was pretty easy to determine heirship. If you died leaving children, they were your heirs. However, in an age of assisted reproductive technologies (ART) the definition is becoming significantly murkier. Today, you may have biological children born years after your death. Are these children your heirs? Do they have rights to your property and estate in the same way that children born during your life enjoy?

These are some of questions facing the United States Supreme Court this term in Astrue v. Capato. In this case, a Florida widow used the frozen sperm of her deceased husband in a successful in vitro fertilization giving birth to twins eighteen months after her husband’s death. She subsequently applied to the Social Security Administration for surviving child’s insurance benefits. The Social Security Administration denied the benefits and the woman appealed. The District Court affirmed the finding because Florida intestacy laws would not recognize the twins as children of the deceased husband. The woman then appealed to the 3rd Circuit which reversed the District Court’s ruling. Now, the case will be heard in front of the United States Supreme Court for clarification of the definition of the word “child.”

The finding by the Supreme Court will likely have widespread implications for Social Security Administration benefits. However, children born through ART may still face challenges under state inheritance laws. If heirs can include posthumously conceived children then presumably probate estates would need to be open indefinitely.

Palm Springs Will and Trust Attorney Discusses the Types of Estate Planning Documents Everyone Should Have

Published on: March 1, 2012 | by Burt + Clerc

A recent study in 2011 found that more than 50% of Americans do not have an estate plan. Furthermore, the study found that 92% of adults under 35 do not have one. A favorite saying among estate planning practitioners is, “Everyone has an estate plan. If you don’t create it yourself the State of California will create one for you.” This simply means that if you don’t create your own plan then the State of California will tell your family members where your assets will go upon your death. This is called intestate succession. To avoid this, everyone, young or old, should have a Last Will and Testament. A Durable Power of Attorney and Advance Health Care Directive are two additional necessary documents that every person should possess.

Last Will and Testament

This document outlines who you would like to inherit your assets at your death. You nominate an Executor to administer your estate and you can also nominate a guardian for any minor children you may have at the time of your passing. You can also nominate a pet guardian for any pets that you may leave behind as well. This is the most basic form of estate planning. Having a Last Will and Testament will allow you to have choose who will inherit your assets but it will necessitate a court proceeding called, “probate” in order for these assets to pass to your heirs.

Even Celebrities Need Good Estate Plans Explains La Quinta Probate Attorney

Published on: February 1, 2012 | by Burt + Clerc

Probate attorneys are well versed in handling contentious probate estates. Usually the problems involve money and beneficiaries and most of the time these problems are never publicized. However, probate problems with famous estates are a different matter entirely. These cases highlight the necessity for good estate planning for everyone.

Rosa Parks was a national figure in the civil rights campaign of the 1950s-1960s. She famously refused to give up her seat on a bus which launched the Montgomery Bus Boycott and became an integral part of the civil rights movement. However, she continued to receive publicity even after her death in 2005 but this time for an entirely different reason. Her last will and testament became part of a six year legal battle in a probate court in Wayne County, Michigan.

At the heart of the matter was a challenge to the validity of Parks’ will between Parks’ nieces and nephews and a charity she designated to receive her estate. The parties finally reached an agreement that gave the family members 20% and the charity the remaining 80% of the estate. However, the litigation could have been avoided entirely with better estate planning documents.

A good estate plan will designate with specificity what your wishes are regarding your entire estate. It will outline to whom you want to receive certain gifts. It will also be clear why you’re choosing to disinherit some heirs. Furthermore, the circumstances under which an estate plan is created should be carefully examined. Estate plans are more likely to be subject to challenges when they are done while an individual is ill, has been diagnosed with a disease, or when there is apparent duress.

Rosa Parks’ estate is a great example why individuals need to have good estate planning documents. No one wants to assume that their heirs will challenge their will but unfortunately this happens all too often. However, with good documents these challenges are less likely and very often completely avoided.
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Palm Desert Estate Planning Lawyer Gives Advice for Drafting Wills

Published on: June 1, 2011 | by Burt + Clerc

Burt + Clerc previously wrote about the need for everyone to have some basic estate planning documents in place. One of these fundamental documents is a will. In California, the probate courts allow an individual to create holographic will. This is essentially a handwritten will. There are some risks involved with this however, and therefore we advise everyone to engage a knowledgeable estate planning attorney to draft your estate planning documents. Sometimes, time will not permit this or there are other reasons why someone may choose to draft his/her own will.

The basic will should include most, if not all of the following elements:
Your full name and place of residence The names of your immediate family members (i.e. children, spouse etc.)
List of specific gifts and their corresponding beneficiary (i.e. car, residence or jewelry)
Names of other beneficiaries Statement regarding the payment of expenses and debts owed by you Name of executor to manage your assets and affairs Name of at least 2 alternate executors in case your first choice is unable to act as executor Statement regarding posting a bond by the executor Name of guardian for minor children along with 2 alternate guardians Your signature Witnesses’ signature and attestation clause

Although the process of creating a will is relatively painless and actually pretty easy, about 50% of Americans die without one. When someone dies without a will it is called intestate and the laws of California determine who will receive your assets and property. This is usually not the distribution that most people would have chosen.
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What is Probate and Why Palm Springs Families Should Avoid It

Published on: March 31, 2011 | by Burt + Clerc

Probate is the legal process of transferring property after a loved one has passed away. It requires a petition to the Probate Court as well as various other forms and court hearings. Most Coachella Valley residents would rather avoid probate altogether because there are some serious drawbacks of having your estate administered through the court. Most notably, the reasons to avoid probate are:

Costs
The attorney fees for administering a probate case are outlined by statute and based on the gross value of an estate. The following are the statutory fees:
4% first $100,000 3% next $100,000 2% next $800,000 1% next $9,000,000 ½ % next $15,000,000 Therefore, an estate with a gross value of $500,000 will pay attorney’s fees in the amount of $13,000.

Privacy
Since a probate is a court process, it is entirely public. Anyone who has the time or desire can walk up to a court clerk and request to see your documents. This includes your last will and testament. Additionally, a notice about the probate case must be published in a local newspaper. Most individuals would rather have their estate administered privately and without court supervision.

Time Consuming
The statutory minimum length of a probate in California is four months long. However, due to court calendars and issues with court reporting requirements, most probate cases last between nine to twelve months. This means that your estate cannot be distributed quickly and any bequests outlined in your will cannot be carried out timely.
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