Probate - Frequently Asked Questions
What is Probate?
Probate is a legal process that takes place after someone dies if there is no living trust. The probate process includes:
- Proving in court that a person is deceased and their will is valid, assuming they had a will. This is fairly routine.
- Identifying the heirs of the decedent.
- Creating an inventory (Form DE-160) of any real estate and personal property of the deceased.
- Having the property appraised.
- Notifying all creditors of the deceased.
- Settling and paying any debts and taxes.
- Distributing the property in accordance with the terms of the will or according to law, if there is no will.
Can I bypass the probate process in California if the estate is small?
In California, an estate with probate assets of less than $166,250 is considered a small estate. These estates can usually be settled using the simplified small estate process which takes far less time to complete. Instead of a formal probate, it requires an affidavit or declaration to be signed under penalty or perjury at least 40 days after death. A probate attorney can help with the details.
How do I obtain a certified copy of a death certificate in California?
The California Department of Public Health has a website where you can obtain certified copies of death certificates and other relevant information.
How do real estate agents at Pacific-Realtors.net obtain their training to become a probate real estate agent?
The owner of the company, Michael Chulak, spent over twenty-two years practicing law in California which included representing clients in probate. Michael Chulak now provides training and education classes in the area of probate sales for our real estate agents and staff.
What is a probate asset?
Assets held only in the name of the decedent are generally probate assets. An asset is not included as a probate asset if it is owned in joint tenancy or if there is another means of determining who receives the asset after death of the owner, such as beneficiary designations for life insurance policies and IRAs. If those designations have been made, the asset avoids probate, otherwise it will be included in the estate and will probated. If there is a surviving spouse, a formal probate can often be avoided with a spousal property petition.
What assets are not subject to probate?
The following assets are not subject to probate: (1) 401 k Accounts, (2) IRA Accounts, (3) Life insurance if there is a designated beneficiary, (4) Real estate held in joint tenancy, (5) Real estate held as community property with right of survivorship, and (6) Property held in a revocable living trust. After the assets that need to be probated are identified, if the gross value exceeds $166,250 (subject to change) a probate is required. All assets passing to a surviving spouse do not need to be probated but a spousal petition must be filed. A spousal petition process takes only about two months on average.
I have been named as the executor of my friend's will. In examining the document, I see no mention of life insurance, but I am certain she had a life insurance policy.
When a person buys a life insurance policy, the policy is rarely mentioned in the person's will and the payout does not become a probate asset. When a person buys a life insurance policy, they name a beneficiary who receives the payout upon proof of death. The beneficiary deals directly with the insurance company. The probate court is not involved. For legal advice, contact a probate attorney. If you need a referral, we can provide one.
Can the executor of a probate estate delegate some of the executor's duties to another person?
Most of the duties of an executor are required to be performed by the executor personally. If there are specific duties an executor wants or needs to delegate, it is important to first obtain the advice of a probate attorney. If you need a recommendation for an experienced probate attorney, see: Attorney Referral Request.
Can an executor of an estate have a paralegal or legal assistant handle a probate?
Paralegals and legal assistants cannot represent clients in court and cannot offer legal advice.
I am in possession of a will that distributes the decedent's estate to me. Isn't this all that I need?
No. The will must be admitted to probate and the estate of the decedent must be probated.
How are assets of the decedent actually transferred to the beneficiaries?
The assets are transferred at the end off the probate process by order of the probate court. No deed is required.
What happens when someone dies without a will or a living trust in California?
When a person dies without a will or living trust in California, the state of California directs who receives the decedent's property. This is referred to as dying intestate. When this happens, the probate property is governed by the laws of intestate succession. Generally, only spouses, registered domestic partners and blood relatives inherit under the laws of intestate succession. Unmarred partners and friends do not. The general order of relatives who inherit the deceased's probate property is: (1) surviving spouse or domestic partner, (2) children and grandchildren, (3) parents, (4) siblings, (5) grandparents, (6) aunts and uncles, and (7) other family members. If a loved one dies intestate, you should consult with a probate attorney.
How does a probate case get started?
Probate begins with the filing of a Petition for Probate (Form DE-111) at the Superior Court in the county where the decedent resided. The petition is usually prepared by the attorney for the person who wants to become the executor or the administrator. The Petition for Probate provides details about the person who died, details about the executor, and information about the heirs. The petition also includes information about the size of the estate and whether a bond will be required.
What is a personal representative?
A personal representative is appointed by the probate court or a decedent's will to administer a decedent's estate. The personal representative is the executor if named in a will, or the administrator if there is no will. The terms personal representative, executor, and administrator are often used interchangeably by probate court judges and probate attorneys.
I have been named as the executor in a will. When can I start managing the probate estate?
You can start managing the probate estate as soon as the court appoints you as the executor. The probate attorney for the estate should inform you when the court has officially appointed an executor.
What is a Notice to Creditors in a Probate?
A Notice to Creditors is a public notice posted by the personal representative in a local newspaper of general circulation as part of the probate of the estate of a deceased person. The notice serves as the official notice to creditors, alerting them that a probate petition has been filed . Creditors have a limited period of time from the date of notification to present any claims against the estate for payment of any money they claim is owned to them.
When is the personal representative required to notify creditors of the probate?
The personal representative must provide notice within four months after the court has issued its Letters, or within 30 days of identifying a creditor.
Who decides whether a petition will be approved?
The decision is made by the probate judge who hears the case, but the preliminary work is usually done by a probate examiner. The probate examiner reviews the file, makes sure that all state laws are complied with, and makes a recommendation to the judge that the petition be approved or denied. If the petitioner disagrees with the recommendation, a hearing will be held to provide the petitioner an opportunity to present his or her case.
What are Letters and the Order for Probate?
Assuming all goes as planned at the first hearing and the court approves the personal representative, then in approximately two to four weeks the probate judge will sign the Order for Probate (Form DE-140). The Order for Probate provides the name of the personal representative and whether he or she will have full authority or limited authority. The Order for Probate becomes effective when Letters have been issued.
If the judge requires a surety bond, the bond must be effective in order for Letters to be issued (Form DE-150). The next step is the issuance of Letters which is the document required to sell any probate property.
What is a probate bond and is it always required?
Probate bonds are designed to protect beneficiaries and creditors against wrongdoing by the personal representative of an estate. If a will contains a provision that waives the requirement for a bond (Form DE-142), it will generally not be required. It will also generally not be required if all of the named beneficiaries in a will sign a waiver of the bond requirement and the waivers are attached to the petition when it is filed with the court. If the personal representative resides outside of California, the probate court will often require a bond even if it has been waived. The amount of any bond will be determined by the court based upon the estimated value of the decedent's property and income generated by that property, To reduce the amount of the bond, the personal representative may request that his or her authority be limited or that a blocked bank account be utilized.
Can a probate judge require a probate bond even if all of the beneficiaries agree to waive it?
Yes. If the executor is out of state, the judge is likely to require a bond, but may require a bond for other reasons based on his or her sale discretion.
What happens if the named executor of a will cannot qualify for a probate bond?
The executor should contact the probate attorney. Often the bonding company will issue a bond to a named executor, who does not otherwise qualify, if an experienced probate attorney maintains dual control over the probate bank account.
What are the different types of Letters?
Letters can be: (1) Letters of Testamentary when the decedent had a will; (2) Letters of Administration when the decedent had no will; (3) Letters of Administration with Will Annexed if there is a will, but the named executor is not available to act; and (4) Letters of Special Administration which is used only in special circumstances. In all cases, Form DE-150 is used.
What is the Independent Administration of Estate Act (IAEA)?
It is a law that permits the personal representative (executor or administrator) to manage and administer most aspects of a decedent's estate without court supervision. Such authority to act under the IAEA can be granted by the Probate Court upon petition or by the decedent's will. If the court grants full authority, the personal representative can sell real estate without court supervision.
Why do probate judges grant limited authority to a personal representative as opposed to full authority?
Not all probate judges are the same. Some are more conservative than others, but they all have complete discretion to decide whether to grant full or limited authority to personal representatives. As a general rule, complex cases and cases involving the sale of large properties most often result in limited authority being granted. Sometimes the judge's perception of the personal representative's ability to make informed decisions regarding the estate plays a part in his or her decision.
How can a person see the will of a someone who has died?
If the estate is in probate, a person can go to the Superior Court clerk's office in the county in which the decedent resided and ask to see the file. The file will include the person's will and any other documents that have been filed in the case.
I share a bank safe deposit box with a person who recently passed away. Will the bank allow me to access the safe deposit box?
If you are a registered owner and have a key you cannot be denied access.
Who is responsible for handling a probate?
If there is a will, the executor named in the will normally hires a probate attorney to file the petition and handle the probate process. If there is no will, the court appoints an administrator who normally handles the probate process. If real estate is involved, the executor or administrator will select a real estate brokerage firm to handle the sale of any real estate. The real estate broker will coordinate everything with the probate attorney.
What must the named executor in a will do in order to get access to the deceased person's bank account so he or she can pay their mortgage and other financial obligations?
The executor must present the bank with Letters issued by the probate court, a certified copy of the death certificate, the newly assigned federal tax identification number (EIN), and his or her photo identification.
As the personal representative of a probate estate, am I required to open a separate bank account for the estate or can I use my own account if I keep track of all income and expenses?
You must open a separate account with no exceptions. Comingling of funds is absolutely prohibited. You will need to obtain an EIN number for the probate estate account which you can obtain from the IRS website.
How does the executor or personal representative obtain a federal tax identification number for a probate estate?
The Internal Revenue Service (IRS) website allows the executor to obtain an EIN in just a few minutes.
Where can I get information about filing tax returns for an estate?
You must consult your probate attorney or a CPA about filing the required tax returns and paying any taxes. You must do this prior to making any distributions from the probate estate. There is also valuable information on the IRS website and the California FTB website.
What is a federal estate tax lien and when does it come into existence?
On the day that someone dies, a federal estate tax lien comes into existence. The lien attaches to all assets of the decedent's gross estate. This means that before real property of a deceased is sold, the personal representative of the estate or the probate attorney needs to obtain a discharge of the federal tax lien from the IRS.
How do I obtain a discharge of a decedent's income tax liability?
Most personal representatives will rely on a probate attorney to obtain a Certificate of Discharge from Federal Tax Lien. Instructions are on the IRS website.
Who selects the real estate broker who will sell any real estate that is in the probate estate?
The personal representative of the estate selects the real estate broker. While the probate attorney may make a recommendation, the personal representative makes the choice.
When buying a property that is in probate, are there any warranties?
No. Probate properties are sold "as-is". It is for this reason that buyers of properties in probate should always have the property inspected before making an offer.
Who signs the listing agreement for the sale of probate real estate?
The personal representative who has been appointed by the court will sign the listing agreement after the court has issued its Letters.
What is the maximum listing period for an exclusive probate listing?
Exclusive probate listings are limited to an initial period of 90 days but may be extended for 90 days at a time up to a maximum of 270 days. Listing extensions require court approval unless the personal representative of the estate has full authority under the Independent Administration of Estates Act.
I am interested in acquiring properties that are in probate. What is my best approach to finding probate properties?
The best way is to contact a firm like Pacific-Realtors.net that specializes in selling probate properties. We obtain listings through both probate attorneys and executors appointed by the probate court.
Are Transfer Disclosure Statements (TDS) required in probate sales?
Most of the time they are not required but there are exceptions. See: Transfer Disclosure Statements (TDS).
Is a formal third party appraisal of real estate required before real estate can be sold in probate?
In nearly 100% of probate cases, the answer is yes. A probate referee will be required to prepare an appraisal of any real estate to be sold before it is listed with a real estate broker.
What is a probate referee?
A probate referee is an appraiser usually selected by the petitioner from an approved list and then appointed by the probate court, to appraise the non-monetary assets listed in the inventory of the decedent's estate. In addition, probate referees are sometimes asked to appraise property not included in the probate process such as assets held in a revocable living trust. Probate referees are experienced appraisers approved by the California Controller's Office. Probate referees typically appraise real estate, antiques, collectibles, furniture, automobiles, securities, and businesses. Most probates require the services of a probate referee, but sometimes a court will waive the requirement for small estates.
What is the 90% rule in probate?
If the personal representative is granted full authority to administer the decedent's estate, under the IAFA, he or she does not have to comply with the 90% rule. Without the grant of full authority, the personal representative must sell probate real estate for at least 90% of the approved value as determined by a probate referee. Under the IAFA, if the personal representative is granted full authority, he or she can use their own discretion to determine the sales price of real estate. They must, of course, be aware of their fiduciary duty to all beneficiaries to maximize the net proceeds.
What is the maximum commission that is payable to a real estate broker for selling a home in probate?
The maximum fee is 6% of the selling price, but the majority of brokers charge 5% for the sale of a house. Most probate courts limit the commission to 5%. The commission for the sale of land is usually higher. Commissions are always negotiable. The court will normally set the commission percentage for apartments and commercial properties.
Can Pacific-Realtors.net assist us with an estate sale involving the sale of personal property?
Will Pacific-Realtors.net help us with securing the property, removing any debris, and getting the property cleaned?
Yes. This is our standard practice with all probate real estate sales.
Can Pacific-Realtors.net assist us in evicting a non-paying tenant from a probate property so we can get it sold?
Absolutely. Contact the owner of our firm Michael Chulak, if you need assistance regarding any probate related matter.
I am concerned about the roof leaking. Will you assist us with such matters?
Absolutely. We can arrange a roof inspection and any needed repairs, a termite inspection, and a general overall building inspection in order to maximize the sales price of the probate property.
How much of a deposit is required to be made by a buyer in a probate sale?
The amount of the deposit required is determined by the personal representative, but it is customary to require 10% of the purchase price.
How long are typical listing agreements for the sale of the properties in probate?
The personal representative can hire a probate real estate agent for a period of 90 days and may extend the listing if it is required.
How are offers to purchase real estate that is part of a probate estate made?
Offers are submitted to the personal representative of the estate using the Probate Purchase Agreement and Joint Escrow Instructions which is a California Association of Realtors form.
What is the difference between an executor and administrator?
An executor carries out the directions and requests set forth in the decedent's will. An administrator is appointed by the probate court to manage the estate of a decedent who dies intestate.
Do all estates require probate?
No. Not all estates must be probated. A probate attorney will be able to advise you. The answer depends on several factors including the size of the estate, the types of property in the estate, and how tittle to the property is held.
What is an ancillary probate and when does it apply?
An ancillary probate is an additional probate proceeding that is required when a decedent owns real estate or tangible personal property in a state other than where he or she resides. For example, if a resident of California dies owning property in Arizona and Nevada, ancillary probates will be required in those two states in addition to California. Ancillary probates are required because the domiciliary state (California), has no legal jurisdiction or right to transfer property in other states to beneficiaries.
Who is the Public Administrator?
A public administrator is a person or entity appointed by the state to act when there is no will or relatives.
Should I hire a probate attorney?
Yes. You should consult with an attorney that has experience with probating estates. Probating an estate requires specialized knowledge so you should not hire an attorney without probate experience.
What are the primary duties of a probate attorney in California?
A probate attorney provides advice, legal assistance, and other related services to the appointed executor, administrator, or personal representative in the handling of a decedent's final affairs. This includes preparing and filing the probate petition with the court. Together with the personal representative appointed by the probate court, they will provide all notices to creditors and heirs as required by law, pay all debts owing, including taxes, make sure there is a proper accounting, coordinate with any ancillary probate attorneys, and make certain that all property is distributed according to the desire of the deceased consistent with California law. See: Duties and Liabilities of Personal Representative. If you are an executor in need of a referral to a probate attorney, please contact Michael Chulak.
What is the difference between an estate planning attorney and a probate attorney?
Estate planning attorneys are hired before a person dies in order to help them create a plan for distributing their assets upon their death. A probate attorney assists the executor or administrator of an estate after a person dies. Many attorneys are both estate planning and probate attorneys.
How much does a probate cost?
The answer depends on the size of the estate. The state of California has established a standard schedule fees for most of the services that will be required to be performed. When you consult with a probate attorney, he or she will be able to estimate the fee. Generally, probate fees are paid from the sale of assets in the estate, so no advance legal fees are usually required.
How much are the probate fees paid to attorneys in California?
While such fees are subject to change, the fees are set by statute as follows:
- 4% of the first $100,000
- 3% of the next $100,000
- 2% of the next $800,000
- 1 % of the next $9 million
- ½ % of the next $15 million
Courts set the fees above $25 million.
What are the probate fees in California?
Customary fees include:
- Attorney fees
- Personal Representative fees, unless waived
- Accounting fees
- Appraisal fees
- Probate bond, unless waived
- Cost to sell probate assets
Can a probate attorney charge a retainer for probate attorney fees?
No. A retainer for attorney fees is not permitted because the court must approve all attorney fees. An attorney may request a deposit to cover court costs.
How much do personal representatives get paid in probate?
While the fees are subject to change and can be waived, the Executor or Administrator (Personal Representative) generally receives the following statutory compensation:
- 4% of the first $100,000
- 3% of the next $100,000
- 2% of the next $800,000
- 0% of the next $9 million
- 5% of the next $15 million
Courts set the fees above $25 million.
Can I draft my own will without paying an attorney?
Yes. However, we don't recommend it. Once a person passes away, they no longer have the opportunity to make corrections to their will. The cost of having an attorney draft a clear, legally enforceable will is not high, but the importance of the document is very high. If you are in need of a recommendation, please contact Michael Chulak for a referral.
What is a holographic will?
A holographic will is a handwritten, testator signed document that must meet specific requirements in order to be recognized. Holographic wills are permitted in California, but not in all states. Holographic wills have major disadvantages, and consequently, we recommend that people needing a will consult with a knowledgeable, licensed attorney. People who write their own will often make highly significant omissions. They also often include things that should have been omitted.
What are the consequences of an invalid holographic will?
Probate Courts often challenge the validity of holographic wills because they are often signed outside the presence of a witness. Probate courts must be convinced that the entire will is in the testator's handwriting and accurately represents his or her last known wishes about their estate. If a probate court is not satisfied that a holographic will is valid, it is likely to distribute the property of the estate according to the laws of intestate succession. This means the desires of the deceased will be defeated. Holographic wills have significant disadvantages which is why we strongly recommend that our clients consult with a licensed attorney. We can recommend a qualified attorney if you need assistance.
What must be included in a will for it to be valid in California?
We strongly recommend that you consult with an estate planning/probate attorney to prepare a will or any other legal document. If you need a referral to a probate attorney, please follow this link: Attorney Referral Request.
What makes a will invalid?
Generally, a will be declared invalid if it was not properly executed, the testator lacked legal capacity, or there was undue influence or fraud. For a will to be properly executed, it must be in writing, signed and witnessed by two competent, disinterested people at the same time. It does not have to be notarized. Probates court determine whether a will exists and if it is valid. For legal advice on this subject, obtain the advice of a California probate/estate planning attorney.
Where should I keep my will for safekeeping?
Keeping your will in a fireproof safe at home is an excellent choice as long as your executor and alternative executor know where the safe is located, have the combination to your safe, and have access to your home. Copies should be retained by your attorney and one kept in your bank safe deposit box. Do not hide it where no one will be able to easily find it. Your probate or estate planning attorney may have other suggestions depending upon your individual circumstances.
What is the difference between "testate" and "intestate"?
When a person dies testate, it means he or she had a will. If a person dies intestate, it means he or she had no will.
If there is no will, how is the property of the estate distributed?
Sections 6400 through 6414 of the California Probate Code addresses intestate succession and the distribution of property. The method and manner of intestate distributions is quite complex and therefore one should discuss intestate distributions with his or her attorney.
What is the difference between a beneficiary and an heir?
A beneficiary is someone named in a will who receives all or a part of the estate of a deceased person. An heir is someone entitled to all or part of an estate, as determined by law, if the deceased died without a will.
What rights do probate beneficiaries have in California? Beneficiaries have the right to:
• Information about the assets in the estate,
• An accounting of all transactions, and
• Receive distributions of assets that were left to them in a timely manner.
Who are heirs at law and why are they important in probating a will?
Heirs at law are the people who would inherit the deceased person's property if there was no will which is called intestacy. Even when a will does exist, it is critically important to identify these people because: (1) they must be notified that a probate has been commenced, and (2) they are allowed by law to challenge the will. A probate attorney will assist the executor in identifying the heirs at will and sending them the required notice.
What happens if I inherit a house with another person such as a sibling?
Since you will both be on the title you will have to decide whether you want to sell the property and divide the money based on your ownership percentages, or not sell it. If the will did not specify the ownership percentages it will be divided evenly. If you decide not to sell the property, you can either lease it and collect rent or occupy It. Since both of you will have the right to occupy the entire house, an arrangement will need to be worked out to avoid a dispute. In more than 95% of the situations where two or more individuals inherit a property, it is listed with an experienced probate real estate firm and sold. If the property is sold quickly, you can avoid paying a capital gains tax. Our firm can assist you in making a wise decision.
What happens if two beneficiaries receive title to real estate from a probate and one wants to sell it while the other refuses to sell it?
The co-owner that wants to sell the property must hire a real estate attorney to file a partition lawsuit in order to obtain a court order forcing the sale of the property. Partition suits rarely result in forcing the co-owners to sell the property. These cases are usually settled. Before filing a partition lawsuit, you may want to attempt to settle the dispute in mediation.
Can real estate be sold during the probate process?
Yes. Pacific-Realtors.net works with probate attorneys, executors, and administrators during the probate process to sell any type of real estate, located anywhere in the United States.
What is a Notice of Proposed Action?
A Notice of Proposed Action is a Superior Court of California form that must be mailed to all beneficiaries when dealing with the sale of real estate in a probate. It is normally prepared by the probate attorney selected by the personal representative. The Notice of Proposed Action must be mailed 15 days prior to the date of the proposed action such as the sale of real estate. If an objection to the proposed action is made during the 15 day period, the probate court will evaluate and make a decision concerning the objection.
Who will receive a notice that a probate has been started?
California law requires that notices be sent to all of the heirs of the decedent, beneficiaries who are listed in the will, and any proposed executors. The notice will state the date and time of the hearing and the court where the case will be heard.
How long does the average probate of an estate take place in California?
The length of time to probate of an estate varies because many factors can affect the timeline. See: Typical Probate Timeline in California.
What are the geographical areas that Pacific-Realtors.net serves?
We represent sellers, as well as buyers in probate sales of property located anywhere in Southern California.
Will your firm accept listing referrals from other real estate offices that have minimal or no experience with probate sales?
Are distributions to a beneficiary from an estate taxable?
Almost never. Any taxes to be paid are generally paid by the executor or administrator during the administration of the estate, prior to making any distributions to beneficiaries.
Can you provide us with a general checklist we can use when we meet with the probate attorney? We expect to be appointed as the personal representative of an estate.
Yes. See: Checklist - Personal Representative
Will owning property in joint-tenancy avoid probate?
It will postpone it until the second person dies, at which point, probate will be required. In the event of a simultaneous death (such as in an auto accident), probate will not be postponed.
Joint tenancy has other possible disadvantages as well. It can result in a loss of control over the assets and may have severe adverse tax consequences. It is not the best estate planning method. Contact an estate planning attorney for specific advice.
What is an advance health care directive?
An advance health care directive is a legal document in which you express your health care wishes if you become unable to participate in health care decisions yourself. Your probate or estate planning attorney can provide you with the form to be completed along with instructions.
How do I protect a decedent's identity from 10 theft?
While it is wise to consult with an expert, the IRS recommends that at least the following be done:
- Send the IRS a copy of the death certificate, this is used to flag the account to reflect that the person is deceased. The death certificate may be sent to the office where the decedent would normally file their tax return (for addresses see Where to File Paper Tax Returns). A copy of the death certificate may also be sent with the decedent's final tax return.
- Send copies of the death certificate to each credit reporting bureau asking them to put a "deceased alert" on the deceased's credit report.
- Review the deceased's credit report for questionable credit card activity.
- Avoid putting too much information in an obituary, such as birth date, address, mother's maiden name or other personally identifying information that could be useful to identity thieves.
Does Pacific-Realtors.net represent successor trustees of living trusts in selling properties?
Absolutely. Contact Michael Chulak or one of our real estate brokers or agents.
Can a beneficiary named in a will or other person not named in a will contest a will in California?
Yes. However, wills drafted by attorneys are rarely contested and when they are contested the plaintiff rarely prevails. It is for this reason that hiring an attorney makes far more sense than writing your own will.