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Probate Administration

Handling the Estate of a Loved One

Overview Of The Probate Administration Process

When a loved one dies, those left behind are often left to not only cope with the loss of a loved one, but also to administer their loved one’s estate. If the estate’s assets are not held by a trust, the assets may need to be administered through the court process called “probate”.

The probate process involves the court appointment of a “personal representative” (also known as an executor or administrator) to handle the decedent’s estate administration. Once the court has appointed a personal representative, the personal representative must ensure collection and protection of estate assets, handle payments to creditors (or resolve disputed claims), and account to the estate beneficiaries and to the court for all transactions. Occasionally, this process is straightforward, but more often there are complicated issues that must be resolved, such as determining which creditors are entitled to priority of payment when limited funds are available, or determining which beneficiaries are entitled to specific distributions through a Will.

California has one of the more complex probate systems in the country and navigating it alone can be a daunting challenge even in “simple” probate cases.

How Long Does Probate Take?

Probate can be a very time-consuming and lengthy process. Some matters may be wrapped up in less than a year, but many matters can take a year or longer, depending on a number of factors.

Who Inherits Through Probate?

This depends on whether the decedent had a Will. If a valid and enforceable Will exists, the terms of the Will govern the distribution of assets. If there was no Will, California law provides several formulae for determining who the heirs of an estate are. The laws are set forth in California Probate Code §§ 6400-6414 and, depending on the assets involved in an estate, these laws can be difficult to interpret without the assistance of an experienced probate attorney.

How Much Does Probate Cost?

California law provides for attorney and executor fees of 4% each on the first $100,000 in value, 3% on the next $100,000, 2% on the next $800,000 and 1% on assets over $1M, up to $10M. In addition to these fees – known as “statutory fees” – courts often award “extraordinary fees” for services performed which were outside the standard scope of a probate administration. In additional to attorney and executor fees, probate cases involve administrative costs, which are typically between $1000-$2000, depending on the county and complexity of the case.

Fortunately, attorney and executor fees in probate cases are paid by the estate when the estate is ready to be closed, so our clients are not required to come up with funds up front. We will typically advance out of pocket court costs as well. When the case is ready to be closed, a petition will be filed with the court itemizing our fees and costs, and requesting authorization for payment. Upon court approval, the executor will pay our fees and reimburse out of pocket costs directly from estate assets.

Do I Need A Probate Lawyer?

Anyone can file probate documents, but it is best to work with an experienced probate attorney to ensure your matter is concluded as efficiently as possible. Probate laws can be very complex, and the overall process can be very difficult for someone not versed in the particular procedures and challenges of probate. An experienced probate lawyer will be able to navigate the probate process competently, and will be better equipped to respond to any unexpected situations that may arise during the probate process.

How Does The Probate Process Work?

The first step in the probate process is to file a petition for probate in the county where the decedent lived. The probate court will then appoint a personal representative to administer and distribute the estate. If the decedent had a will, the executor named in the will is usually the personal representative. If the decedent died without a will, they are considered to have died “intestate” and the court will appoint an Administrator to act as personal representative. The court can also appoint an administrator if the executor cannot act or does not act.

Once the personal representative is appointed and the petition for probate is approved, the Court will issue either Letters Testamentary (for decedents who had a Will) or Letters of Administration (for those who did not), which enable the personal representative to conduct the estate’s business. This may include preparing an inventory of the estate assets, settling any claims against the estate, and selling real or personal property.

An inventory of the estate includes all of the estate’s property. For example, homes, cars, bank accounts, investment accounts, and personal property (such as household furnishings and jewelry) are all considered property of the estate. Once the personal representative has completed this inventory, it must be forwarded to the court-appointed probate referee, who will appraise and place values on the estate property.

The personal representative must also notify creditors of the existence of the probate estate, both by notifying known creditors and publishing a “Notice to Creditors” in a local newspaper. Any creditors who wish to be paid must file a claim in the estate (usually within 4 months of the estate being opened), and the personal representative will determine whether to pay or reject a claim. However, if a claim is rejected, a creditor may file a separate suit against the estate to attempt to recoup their money, and this can delay the administration of the probate estate until the suit is resolved.

In many cases, the personal representative must also notify various government agencies of the administration, including Medi-Cal, Franchise Tax Board, and the Veteran’s Administration. Executors must also pay any state and federal taxes that may be due, and they may be required to file suit against any person or entity who may be holding property that belongs to the estate in order to recover it.

Once an estate’s assets have been inventoried and liquidated (where applicable) and the appropriate payments have been made to creditors, the personal representative will prepare a petition to distribute the remaining assets to the beneficiaries and close the estate. At this time, the representative must also file an accounting that shows all actions and dealings with estate assets and liabilities. The beneficiaries may waive their right to an accounting, but otherwise this must be prepared and submitted to the beneficiaries and filed with the court.

The court will set a hearing date to close out the estate, and if the paperwork is prepared properly and there are no objections to the petition to close the estate, the court will grant the petition, allowing the representative to take the actions necessary to distribute the assets and close the estate.

Does Every Estate Have To Go Through Probate?

No. Probate is typically only necessary when assets have not been transferred to a Trust during the lifetime of the settlors, or otherwise effectively designated to pass to specified beneficiaries, and such assets exceed $150,000 in value.

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