From the desk of San Diego Trust Attorney and Probate Attorney, Kristina Hess (with research and contribution by Klint Leblang)
Useful Information Regarding the Probate Process (third post in Probate series)…
Probate is the process when a court supervises the transfer of legal title of property from the estate of the person who has died, known as the decedent, to his or her beneficiaries. Although probate can be a timely and costly process, probate is generally required if the person owned property (exceptions do exist to this general rule).
The most basic form of probate is providing a valid Will to the court, appointing a legal representative to act on behalf of the decedent (generally defined in the Will), identifying and inventorying the decedent’s property, pay debts and taxes, and then distributing the remaining property according to the terms of the Will or to the decedent’s heirs.
For further information regarding the basics of probate, please click here.
Dying with no Will Still Follows the Probate Process
Although it is regularly thought only a person who dies with a Will will go through the probate process, a person who dies intestate, without a Will, will similarly go through the probate process. When this occurs, the probate court will appoint a personal representative (known as an “administrator”) to handle the probate matter. Instead of the decedent’s property being distributed based on the terms of the Will, the property will be distributed based on state law. For the most part, the intestate succession laws are comprehensive and benefit the decedent’s family. However, an attorney should be contacted even when the person dies intestate to ensure the decedent’s property is being distributed correctly based on state law.
If a Will is lost or cannot be found, it has different circumstances than when a person dies without a Will. For instance, if a Will is missing because it has been revoked by the decedent, an earlier Will or intestate succession will determine who gets the decedent’s estate. If the Will was destroyed, in a fire or natural disaster, the probate court may accept a photocopy of the Will to prove one existed. This is done by providing the court with the lawyer’s draft of the will or a computer file saved by the decedent. It is important that evidence be provided the decedent signed the original Will properly.
Along these lines, a Will can be contested by filing an objection to the Will or producing another Will. This is a “Will Contest.” Only a person with “standing” can contest a Will. This is a person who has a personal financial stake in the outcome such as an heir or other family member. Further people who have standing are:
- a child or spouse who was cut out of the Will,
- a child who receives one third of the estate if a sibling receives two thirds,
- children who feel that the local charity should not get all the parent’s assets,
- someone in the Will wants a different person, bank, or trust company to serve as personal representative for the estate or trustee of the trusts created by the Will,
- anyone who was treated more favorably in an earlier Will, etc.
Potential heirs or beneficiaries who get little or nothing from the Will are most likely to challenge the Will. Will contests must be filed in Probate court within a certain period. This is usually within a certain number of days after receiving notice of the death. It can also be a certain number of days after the petition to admit the Will to probate, or after an issuance of Letters Testamentary to a personal representative. Reasons to challenge a Will include:
- there is a later Will which, if valid, would replace the earlier Will;
- the Will was made at a time the decedent was not mentally competent to make a Will;
- the Will was the result of fraud, mistake or “undue influence”;
- the Will was not properly “executed” (signed by the decedent);
- the so-called Will is actually a forgery;
- for some other reason (such as a pre-existing contract) the Will is invalid.
Contact an attorney for more specific information regarding timelines to file a Will Contest or to determine if your deadline has passed. Further, if a Will Contest has been filed, contact an experienced attorney. A probate court may invalidate all or a portion of the Will resulting in certain beneficiaries losing their inheritance rights. Thus, it is crucial to contact an attorney to ensure you do not lose your inheritance rights.
Owning Land in More than One State
The probate laws of the state where the decedent was a permanent resident determine who will get the decedent’s real property located within the state and the decedent’s personal property wherever it is located. Therefore, decedents who are permanent residents of San Diego, California should file their probate matters first in San Diego, California. However, if the decedent owned real property in more than one state, a probate must be opened in each of those states. Therefore, a probate is opened in the decedent’s home state and subsequently each state in which the decedent owned real property. This probate procedure is known as ancillary probate. Further, some states require the personal representative of that probate be a local resident.
Creditors of the Decedent’s Estate
The probate process requires notification to the creditors of the decedent’s estate. The requirements for notice vary. You may be required to provide direct notice to the creditor or publishing notice in a newspaper where the decedent lived will suffice. Creditors are required to file claims with the court for the amounts due within a fixed time period. The executor can either approve the claim and pay the bill out of the estate or reject the claim. If the claim is rejected, the creditor must sue for payment. If there is not enough money to pay the claim, property will likely be sold to pay the claim. Generally, a beneficiary will not have to pay out-of-pocket for the decedent’s debts. Certain exceptions apply, such as the decedent acted to defraud the creditors or the decedent gave away all assets prior to death. Another exception is the spouse’s responsibly to pay the deceased spouse’s bills. You should contact an attorney to determine your exact legal responsibility for a decedent’s bills.
For federal taxes, you may have to fill out and file one or more of the following forms. (It depends on the decedent’s income, the size of the estate, and the income of the estate):
- Final Form 1040 Federal Income Tax return (the decedent’s personal income tax return)
- Form 1041 Federal Fiduciary Income Tax returns for the estate
- Form 709 Federal Gift Tax return(s)
- Form 706 Federal Estate Tax return
For California taxes, the executor must file any needed state income tax return, state fiduciary income tax returns during the probate period, estate tax and gift tax returns. There may be other taxes, too, like local real estate and personal property taxes, business taxes, and any special state taxes. It is crucial to contact an attorney regarding taxes to ensure no penalties will result to the family for failing to pay all necessary taxes.
Probate in California is a long and lengthy process that can be extremely confusing to a family that does not have experience with the probate process. It is commonly recommended that a family contact an experienced probate attorney to help administer the estate.
If you are currently in probate or have questions regarding probate, please contact our office today.
Please note that this blog is not intended to provide legal advice and is for general informational purposes only.
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Make Sure Your Loved Ones Receive Your Property When You Die.
Kristina Hess, San Diego Probate Attorney