2023 Threshold For Probate In California

What Is The Probate Limit In California In 2023?

In California, if the value of all “probate” assets exceeds a threshold of $166,250 then a formal probate administration is required to transfer those assets. If the value of all “probate” assets is equal to or less than $166,250 then the personal representative may use a small estate affidavit to transfer the assets. “Probate” assets are those assets which do not transfer upon death via a trust, a beneficiary designation form, a “Pay on Death” (“POD”) or Transfer on Death (“TOD”) account or by a right of survivorship, such as a joint tenancy with right of survivorship or community property with right of survivorship. To use the affidavit, the personal representative must list all probate assets, the holder of those assets, such as a bank, and the value of those assets on the decedent’s date of death. The affidavit specifies the person(s) entitled to receive the property. And 40 days must have passed since decedent died before the affidavit may be signed and presented. When ready, the affidavit is presented to the holder of the assets and the holder transfers the assets with no additional proceedings. Use of a small estate affidavit saves the estate significant time and money, making it the preferred transfer method.

What Is Considered A Small Estate In California?

A small estate in California is one in which the value of all “probate” assets is equal to or less than $166,250. “Probate” assets are those assets which do not transfer upon death via a trust, a beneficiary designation form, a “Pay on Death” (“POD”) or Transfer on Death (“TOD”) account or by a right of survivorship, such as a joint tenancy with right of survivorship or community property with right of survivorship.

Do I Need An Attorney For A Small Estate Affidavit In California?

An attorney is not required to prepare a small estate affidavit. However, it is wise to consult with an attorney to ensure you’ve properly accounted for all assets and are not inadvertently leaving them off the affidavit. The affidavit is signed under penalty of perjury therefore you want to make sure you are accurately representing all assets that belong on the affidavit.

Does Homestead Property Have To Be Probated In California?

Yes, in order to claim the probate homestead set-aside the asset must be part of a formal probate administration. Assets passing outside of a probate administration, such as joint tenancy property, community property or trust property are not eligible for the probate homestead set-aside. The probate homestead set-aside is used to protect the family home from creditors for the benefit of the decedent’s surviving spouse or registered domestic partner and/or minor children. It may also be used if the decedent named a person other than their surviving spouse or registered domestic partner and/or minor children as a beneficiary of their home.

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What Is Exempt Property Under California Probate?

Exempt property in California is all property which can transfer outside a formal probate administration. All property properly titled and transferred to a trust is exempt from probate. Any property with a valid beneficiary designation, such as a life insurance policy or retirement account, is exempt from probate. Property held in a “Pay on Death” (“POD”) or Transfer on Death (“TOD”) account is exempt from probate. Last, any property with a right of survivorship, such as property held as joint tenancy with right of survivorship or as community property with right of survivorship is exempt from probate. However, be careful if you are relying on these transfers to avoid probate as they don’t always provide for what happens if a beneficiary predeceases the property owner.

Who Is Generally Involved In The Small Estate Probate Process In California?

The people generally involved in the small estate probate process in California are the decedent’s beneficiaries or heirs, known in the small estate process as the “successors of the decedent”, and any person or company in possession of the property, known as the “holder of property”. If the decedent died with a will then their beneficiary or beneficiaries named in the will are considered the successors of the decedent. If the will is a pour over will then the decedent’s trust is considered the beneficiary. If the decedent died without a will then the decedent’s heirs under California’s intestacy laws are considered the successors of the decedent. Generally, under intestacy laws, heirs are the decedent’s closing living relatives.

What Alternatives To Probate Are Available In California?

Explore these probate alternatives in further depth with our probate lawyers and see if you can avoid the notoriously expensive and time-consuming probate process.

Small Estate Affidavit

These apply to estates valued at up to $166,250 in personal and real property or $55,425 in real property. For only a $45 filing fee, a 0.1% probate referee fee, and attorney fees, your assets can be distributed 40 days after death.

850 Petition

Also known as the Heggstad Petition, this probate alternative applies to instances where a decedent does not correctly transfer a valuable asset into a trust before death. Probate attorney’s fees and filing fees, which are only around $500, are all you must pay to do this.

Payable-on-Death (POD) and Transfer-on-Death (TOD)

Taking this path ensures certain accounts and property are transferred to your beneficiaries in particular circumstances without them getting caught up in probate.

Spousal Property Petition

These petitions can give living spouses a clear title to assets in the deceased’s name.

Why Do So Many Try To Avoid Probate?

Perhaps the main reason why people take great lengths to avoid probate is how time-consuming completing the process is. Probate can take months, even years in some cases, to resolve. This is a significant inconvenience, but having a case with additional delays worsens things for the estate’s beneficiaries. Unfortunately, without a probate process lawyer working on your behalf, chances are high that you, like many others, will experience this headache of probate.

Another factor that makes people avoid probate is how expensive it is. This is because many expenses, such as attorneys’ fees, court costs, and other expenses, will significantly reduce the estate’s value.

On top of this, your probate case will be accessible to the general public once it enters the process. Because of this, anyone can access details from the case, including the deceased’s assets, debts, and beneficiaries. This may pose particular challenges for you if you have sensitive family matters or if the deceased was a public figure.

Finally, and perhaps most concerning, is how often probate results in outcomes vastly different from what the deceased intended. Courts ultimately have the final say over how assets are distributed, which can agitate an already tense situation between family members and beneficiaries.

How Can I Avoid Probate In California?

You can make use of trusts, joint tenancy, and other beneficiary designations to have assets directly transferred without going to probate while providing more control to your beneficiaries and loved ones over how the estate is ultimately distributed. As well, you may be able to leverage the following less well-known methods to avoid probate:

Small Estate Affidavit
850 Petition
Spousal Property Petition

Each way of avoiding probate has advantages and disadvantages. Consulting with one of our probate attorneys in San Francisco, California, about your specific situation will enlighten you on more detailed ways to avoid probate relevant to your case. By taking steps to avoid probate, you can simplify the process of settling your estate and ensure that your wishes are carried out in a timely and cost-effective manner.

Is Probate Mandatory In California?

Probate is not mandatory in California in the strictest sense, but it is often required to transfer ownership of assets after a person dies. Although this does not occur all the time, probate is the legal process designed to ensure that this is done according to the deceased’s wishes or in compliance with California law if there is no will.

In California, probate may especially be necessary if the deceased had assets in their name valued at $166,250 or more. Assets held in a trust, jointly owned, or have a named beneficiary are generally not subject to probate, but there are exceptions to this general rule.

Even if probate is not required in a particular situation, people sometimes choose to go through the process to get legal clarity and avoid future disputes among family members. Additionally, some specific assets may require probate even if they are owned jointly or have a named beneficiary, such as real estate held as tenants-in-common. It is wise to seek counsel from a probate attorney to know where exactly your assets may fall.

What Assets Are Exempt From Probate In California?

In California, certain assets are exempt from probate. As a result, they can be transferred directly to beneficiaries. Some include:

Living trusts: These provide an exemption from probate. Upon the death of the trust’s creator, the assets are distributed to the beneficiaries specified in the trust’s terms.
Jointly owned property: Assets that are owned jointly with another person, such as a home or a bank account, are exempt from probate. When one owner dies, the property automatically passes to the surviving owner.
Retirement accounts: Assets held in retirement accounts, such as 401(k)s and IRAs, are exempt from probate if they have a designated beneficiary. When the account holder dies, the assets are distributed directly to the beneficiary via the financial institution, completely bypassing probate.
Life insurance proceeds: Life insurance policies that have a designated beneficiary are exempt from probate. The death benefit is paid directly to the beneficiary when the policyholder dies.
Payable-on-death (POD) accounts: Bank accounts, certificates of deposit, and other financial assets with a POD designation are exempt from probate. The assets are transferred to the named beneficiary upon the account owner’s death.
Transfer-on-death (TOD) deeds: Real estate with a TOD designation is exempt from probate. The property is simply transferred to the named beneficiary.

These asset types may be subject to estate taxes and other fees, regardless of whether or not they are exempt from probate. Seeking counsel from a probate process attorney will help you determine what may be the case for your assets and best plan accordingly.

Who Needs To Undergo The Probate Process In California?

In California, probate is required when a person dies owning assets in their own name that are worth more than $166,250. However, in certain situations, probate may be required even if the estate is below the $166,250 threshold. Some examples include:

Real estate: If the deceased person had real estate in their own name, probate may be required to transfer the property to their beneficiaries.
Assets held as tenants-in-common: If the deceased person owned assets as tenants-in-common with another person, probate may be required to transfer the assets to their beneficiaries.
Debts and taxes: If the deceased person had outstanding debts or taxes when they died, probate might be necessary in order to settle these obligations before the remaining assets can be distributed to beneficiaries.
Disputes among family members: If there is a dispute among family members over how the assets are to be distributed, probate may be the only way to resolve those disputes legally.

Again, seeking counsel from a probate attorney will help you determine how exactly probate may apply to the assets in question in your circumstance, whether you can avoid it, and, if not, how to best approach the situation.

For more information on Probate Law in California, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (415) 529-4541 today.

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What Is The Threshold For Probate In California And What Does That Mean?