Probate Lawyer Serving the Sonoma Area
As you learn more about trusts and their role in estate planning, you’ve likely heard the term “probate” many times. Avoiding the lengthy and costly probate process is one of the key benefits of establishing a trust. Learn more about probate, how assets are handled differently in wills and trusts, and why some people want to bypass probate.
What is probate?
Probate is the process of proving the validity of a will. After an individual passes away, the court appoints a legal representative to act on the decedent’s behalf. The court verifies that the will is valid and that there are no other valid wills in circulation. From there, the decedent’s assets are inventoried and appraised. After assets are used to pay off debts and taxes, they are distributed to beneficiaries named in the will. If there is no will, assets are distributed in accordance with California state law.
Why should I try to avoid probate?
If you ever hear people talk about the probate process, you probably hear it spoken about in a negative way. While the process is generally over in a matter of months for most families, there are cases in which probate lasts years. This is a particularly big risk for large estates and those with feuding family members. If beneficiaries hire probate attorneys during this time, the costs associated with probate can add up quickly.
Additionally, probate documents are available for public review once they are filed with the court. For many people, this is reason enough to plan ahead to avoid probate.
Many people also worry about the loss of control that comes with probate. While it’s likely that the court will respect a decedent’s wishes and distribute assets as outlined in their will, the fact is that the final decision still lies with the probate judge.
How are wills and trusts handled differently in probate?
Assets accounted for in a will must go through probate. At the time of an individual’s death, their assets are in their possession. Probate ensures that assets are properly distributed in accordance with the will, assuming that there is a legally valid will.
Assets held in a trust do not typically go through probate in California. A trust is a separate legal entity from the decedent, so when the individual passes away, their assets are already owned by the trust. Upon their death, their named trustee automatically takes responsibility for administering the trust. Since the assets are not owned by the decedent at the time of death, they do not have to go through probate.
How quickly do beneficiaries get access to a trust?
Beneficiaries get access to assets held in a trust as soon as the trustee finishes their duties as personal representative. The process is generally fairly quick, unless the trust is extremely complicated or has a number of assets that must be sold off before funds can be disbursed to beneficiaries. In some cases, beneficiaries have to wait until a certain date or life event to gain access to assets set aside for them in a trust. For example, an individual may set their trust up to give 20% of their assets to a child when they turn 18, 20% when they turn 25, and the remaining 60% at the age of 30.
How can probate be avoided?
A trust is one of the most common strategies used to avoid probate. There are other options, including:
- Payable on death accounts. Some accounts allow you to name a POD beneficiary. This allows the beneficiary to inherit all of the money in the account after they provide your death certificate.
- Distributing assets as gifts prior to your death is one way to prevent those assets from going through probate.
- Small estate. Under California law, some small estates do not have to go through the probate process.
- If property is owned jointly by two people and one person dies, the other person immediately takes full ownership of the property.
Let Us Help You with Your Estate Planning Needs
There’s a lot to consider when you are crafting an estate plan, and we know it can be overwhelming. We are here to help. Download our free estate planning guide or schedule your free case evaluation with Gullotta Law Group now.