You are not required to serve as a personal representative. You can decline the nomination and in some cases you can nominate an alternative person.
Are Personal Representatives Usually Paid For Their Work Throughout The Probate Process?
The personal representative is entitled to compensation for their work performed throughout the probate process. Their compensation is equal to the statutory compensation paid to their attorney as set forth in the probate code. Fees are predetermined by the probate code which calculates the fees based on a percentage of the estate’s gross value. Since it is based on gross value, the value is not reduced by debts such as a home mortgage. The personal representative is entitled to statutory fees as follows:
4% on the first $100,000 or fraction thereof
3% on the next $100,000 or fraction thereof
2% on the next $800,000 or fraction thereof
1% on the next $9,000,000 or fraction thereof
½ of 1% on the next $15,000,000; and,
A reasonable fee on the excess over $25,000,000.
Thus, for example, the fee for an estate appraised at $500,000.00, would be calculated as follows:
| 4% on $100,000.00 | $4,000.00 |
| 3% on $100,000.00 | $3,000.00 |
| 2% on $300,000.00 | $6,000.00 |
| Total Fee: | $13,000.00 |
Additionally, if the personal representative provides extraordinary services above and beyond the standard administration requirements then these fees are paid based on an hourly rate approved by the court as just and reasonable.
What Happens If The Personal Representative Fails To Perform Their Duty?
If the personal representative fails to properly perform their duties under the probate administration they may be held personally liable if they’ve caused financial harm to the estate, and/or they may be removed and replaced by the court. The personal representative may be personally liable if they misuse estate funds, make risky investments, or improperly distribute estate assets. Additionally, the court may remove the personal representative if they do not act in a reasonable and timely manner to administer the estate.
What Happens When The Person Who Has Died Owned Land In Multiple States?
If the decedent owned land in any state outside of California, the California probate process will not control the distribution or management of that property. Instead, the personal representative or another interested party must open a probate administration in that state and under that state’s probate laws. This administration is known as an ancillary probate administration.
Do Beneficiaries Have To Pay Creditors Out Of Their Pocket If The Estate Is Insolvent?
Beneficiaries do not have to pay the decedent’s debts, even if the estate is insolvent. Note, beneficiaries may elect to advance funds on behalf of the estate to preserve or protect estate assets. But they are entitled to be reimbursed for those advancements.
How Are Taxes Handled In Probate In California?
There are three broad categories of taxes in a probate administration: (1) estate taxes, (2) income taxes, and (3) property taxes. For estate taxes – California does not have an estate tax. There is an estate tax at the federal level, but the tax is only due on assets in excess of the estate and gift tax exemption. In 2022, the total exemption is $12,060,000 per person. If estate taxes are due, the personal representative must file an estate tax return within nine months after the decedent’s date of death unless an extension is filed.
For income taxes – the personal representative must file a final state and federal income tax return for the decedent in the year following their death if any income was earned in the year of their death. Additionally, the personal representative must file an income tax return for the estate if the estate earned reportable income. This may occur, for example, if the personal representative sells estate assets, such as a home.
For property taxes – the personal representative must notify the county assessor’s office of the decedent’s death, they must claim any available exemption to avoid reassessment, and they must pay the taxes in a timely manner.
If taxes are due, they must be paid from the estate before any other assets being distributed.
For more information on Probate Law in California, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (415) 529-4541 today.
