What Assets are Subject to Probate in CA? | Law Offices of Daniel Hunt (2024)

FAQs

What Assets are Subject to Probate in CA? | Law Offices of Daniel Hunt? ›

Retirement Accounts: Assets such as IRAs, 401ks, and other retirement accounts or life insurance policies often have beneficiary designations and are excluded from probate. Financial accounts sometimes have beneficiary designations as well. These assets pass outside of probate if the beneficiary survives the decedent.

Retirement Accounts: Assets such as IRAs, 401ks, and other retirement accounts or life insurance policies often have beneficiary designations and are excluded from probate. Financial accounts sometimes have beneficiary designations as well. These assets pass outside of probate if the beneficiary survives the decedent.

First and foremost, there are a number of asset types that typically do not pass through probate. This includes life insurance policies, bank accounts, and investment or retirement accounts that require you to name a beneficiary.

This can include vehicles, land, houses, bank accounts, investment accounts, stocks, bonds, and business interests. If your name is the only name listed on the deed, title, or account, then the items won't pass on to your beneficiaries without going through the probate process first.

Examples of non-probate assets are: jointly-owned property (car, home, bank accounts, etc.), 401(k)s, life insurance, Transfer on Death accounts, and life estate properties. Understanding what assets of yours constitute probate and non-probate assets is critical when structuring your estate plan.

Individual Bank Accounts

If the decedent owned a bank account and did not name a beneficiary, the account will probably have to pass through probate—the rigorous and time-consuming process whereby the court oversees the dissolution of an estate.

Vehicle titles are easily transferred, however, without the necessity for probate administration, should the owner pass away. Despite the ease of such transfers, some people do still transfer ownership of their vehicle(s) into their trustee's names.

Jointly owned property

Property owned as joint tenants does not form part of a deceased person's estate on death.

Transfer-on-death (TOD) accounts: This type of designation transfers ownership of the account to the named beneficiary on the death of the owner. As with a POD account, ownership of the account remains solely yours.

Accounts or assets with named beneficiaries usually won't go through probate, including most assets held in trusts. This includes assets, such as investment accounts with transfer on death (TOD) designations and retirement accounts (IRAs and workplace accounts).

What has to go through probate in California? ›

Any assets that do not qualify for a simple transfer process will likely have to go through formal probate. And, if the dead person's property is worth more than $166,250, none of the exceptions apply. You must go to court and start a probate case.

Establish a living trust: This is a common way for people with high-value estates to avoid probate. With a living trust, the person writing the trust decides which assets to put into the trust and who will act as trustee. When the trust owner dies, the trustee will divide the assets outside of probate.

Do retirement accounts pass through probate? NO, as long as the beneficiaries are properly designated. Keep in mind that if the will stipulates anything about such accounts, the named beneficiaries take precedence over the will and the assets will be distributed to the named beneficiaries on the accounts.

Common examples include life insurance policies, IRAs, 401(k)s, and pensions. Bank accounts with beneficiaries. These do not go through probate if they have a payable on death (POD) designation. Other property such as real estate or vehicles is non-probate property if there's a transfer on death (TOD) designation.

For example, real property held in the decedent's name alone is a probate asset. All bank accounts, retirement benefits, life insurance policies, and other accounts with no named beneficiary are also probate assets. If the estate is named as the beneficiary of a particular asset, then it is considered a probate asset.

One of the most common non-estate assets is a life insurance policy. Even if a life insurance policy was owned by the deceased, the proceeds pass according to the terms of the policy. Generally, that means directly to the listed beneficiary.

In California, probate settles a deceased person's estate and is required in California if the estate is worth more than $184,500. It typically occurs when the deceased person died without a will, but it can occur even if the deceased person did have a will if they owned real property that is subject to probate.

In California, you can add a "payable-on-death" (POD) designation to bank accounts such as savings accounts or certificates of deposit. You still control all the money in the account -- your POD beneficiary has no rights to the money, and you can spend it all if you want.

You can transfer property without opening probate if the estate is valued under a set amount. That amount changes every few years and is based on the year the person passed away. You can find the latest limits in Maximum Values for Small Estate Set-Aside & Disposition of Estate Without Administration (form DE-300).

If mom and dad have their home vested as community property with right of survivorship, then upon the death of the first spouse, the surviving spouse automatically gets the house. However, upon the death of the last surviving spouse, a probate is necessary.