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Why Should I Want to Avoid Probate?

There are many reasons why people want their estates to avoid probate. Some of these include concerns about the time and money spent on probate, while others deal with the privacy issues of settling an estate in court.

In case you aren’t familiar with probate, this is the legal process of transferring property from the estate of the decedent to those named in their will. If property is not held by a trust or can pass outside of probate, the probate court directs the transfer of property according to the will’s instructions.

People Often Want to Avoid Probate

When people build their estate plans, they have a variety of options they can use to accomplish their goals. One of the most common estate planning goals is to ensure that property won’t have to pass through probate before transferring to a loved one.

Although someone can have their unique reasons for wanting to avoid probate, there are a few common reasons that many people share. Generally speaking, these reasons reflect the disadvantages of the probate process as a whole.

Probate Can Be Expensive

What it can cost to probate an estate depends on a variety of factors. A simple estate of relatively modest value might not cost much to probate compared to a more complex estate of significantly greater value.

Common probate fees your loved ones might encounter can include the following:

  • Filing and court fees
  • Probate bond (unless waived by the will or all beneficiaries of the will)
  • Attorney fees
  • Executor fees
  • Fees for appraisers, accountants, and other professionals

Although executor fees can be waived, executors are permitted by law to take a fee. California law permits both the executor and attorney to each take fees according to the following schedule:

  • 4% fee on the first $100,000 of the gross estate value
  • 3% fee on the next $100,000 of the gross estate value
  • 2% fee on the next $800,000 of the gross estate value
  • 1% fee on the next $9 million of the gross estate value
  • 0.5% fee on the next $15 million of the gross estate value
  • A reasonable fee when the estate exceeds $25 million in gross value

Probate Can Be Time-Consuming

Probate can take up to two years in California. Many estates can be settled in around nine months or so, but how long the process will actually take depends on factors such as the estate’s size and complexity.

Probate is considered slow because proceedings occur according to the court’s calendar, which can be packed with other cases. There are also certain legal maneuvers that can require the court’s approval, such as refinancing a loan or liquidating property. Lastly, litigation arising from creditors, heirs, or other interested parties can put the overall process on hold for the time being.

Probate Is a Matter of Public Record

Because probate is a process overseen by the court, what happens during proceedings is a matter of public record. This means that all documents detailing property transfers can be researched by anyone. In most cases, even the value of the decedent’s assets can be disclosed through detailed inventories that are assembled during probate.

How Can I Avoid Probate?

If you want your estate to avoid probate, you can construct an estate plan aimed at achieving this goal. There are a few different ways you can keep property out of the probate process, but you will need a capable estate planning attorney to help you ensure your plan can work.

Form a Trust to Avoid Probate

All trusts avoid probate, and the most common type of trust in use is a revocable living trust. This type of trust gives someone the flexibility to use their property as they normally would without retaining it in their personal estate, which would be subject to probate.

Because trusts avoid probate, that means there are no required statutory fees like those outlined above, which can mean a more cost-efficient administration of the estate. Your loved ones can also save time because the schedule your trustee works on to administer your estate isn’t at the whim of court-imposed deadlines or delays.

Lastly, the administration of a trust is a private affair. Because this process is conducted outside of court, there’s no need for records about one’s estate to become publicly accessible.

Additional Ways to Avoid Probate

Forming a trust can be an effective way to keep most of your estate out of probate, but there are other joint ownership arrangements you can make that avoid probate. Two of these are joint tenancy and community property with the right of survivorship.

When holding an asset in joint tenancy with a co-owner, the death of either owner can trigger the automatic transfer of ownership interest to the surviving owner. The ability for this interest to pass to the other owner without going through probate is known as the right of survivorship. Joint tenancy can be an effective way for married couples or business partners to avoid probate for certain assets.

Community property pertains only to married couples. Community property includes any asset or debt gained by either or both spouses during the course of their marriage. Certain types of community property can be titled with the right of survivorship, which helps it avoid probate; however, there can be significant adverse tax consequences for allowing high-value assets to pass outside of the estate plan.

We Can Help Your Estate Avoid Probate

The methods your estate plan can use to avoid probate will depend on your unique situation. If you are searching for someone who can help you assemble an estate plan that can accomplish this and other goals you may have, don’t hesitate to reach out to The Law Offices of Maria N. Jonsson, PC for assistance.

Our attorney has many years of experience helping people like you make plans for the future. We understand that estate planning can be a daunting process, but it’s doable – especially when you have our capable attorney guiding you through each step along the way.

Learn more about what The Law Offices of Maria N. Jonsson, PC can do for you by contacting us online today.