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Probate and Trust Administration

Probate
Probate is a legal process that takes place after someone dies. It includes:

  • Proving in court that a deceased person’s will is valid (usually a routine matter)
  • Identifying and inventorying the deceased person’s property
  • Having the property appraised
  • Paying debts and taxes
  • Distributing the remaining property as the will (or state law, if there’s no will) directs

Typically, probate involves paperwork and court appearances by lawyers. The lawyers and court fees are paid from estate property, which would otherwise go to the people who inherit the deceased person’s property.

Probate usually works like this: After your death, the person you named in your will as executor — or, if you die without a will, the person appointed by a judge — files papers in the local probate court. The executor proves the validity of your will and presents the court with lists of your property, your debts and who is to inherit what you’ve left. Then, relatives and creditors are officially notified of your death.

Your executor must find, secure and manage your assets during the probate process, which commonly takes a few months to a year. Depending on the contents of your will and on the amount of your debts, the executor may have to decide whether or not to sell your real estate, securities or other property. For example, if your will makes a number of cash bequests but your estate consists mostly of valuable artwork, your collection might have to be appraised and sold to produce cash. Or, if you have many outstanding debts, your executor might have to sell some of your property to pay them.

In most states, immediate family members may ask the court to release short-term support funds while the probate proceedings lumber on. Eventually, the court will grant your executor permission to pay your debts and taxes and divide the rest among the people or organizations named in your will. Finally, your property will be transferred to its new owners.

Other estate administration techniques
Small estate exception: In California there is a procedure for estates not exceeding $100,000 to avoid probate. This section may be used to by the heirs to (1) collect money due the decedent; (2) receive decedent’s tangible personal property; (3) have transferred any “evidence of a debt, obligation, interest, right in security, or chose in action” belonging to the decedent. This procedure is limited to personal property and if the decedent has an interest in real property (which wasn’t held in joint tenancy), this section may not be utilized to clear title to real property. In determining the $100,000 limit, there are a number of statutory exclusions that may be applicable. You should consult with your attorney to see if you qualify for this procedure.

Spousal set-aside or confirmation: Community, quasi-community and separate property passing to a surviving spouse are all eligible for a spousal set-aside. Thus, probate administration may also be completely avoided where the surviving spouse succeeds outright to a decedent’s entire estate.