Basics Of Estate Planning
What Is Probate And What Does It Mean?
Probate is a legal process in California that deals with people who are deceased, disabled or incapacitate as well as guardianship of minor children. The Probate Court administers the estate of an individual that dies with assets and determines how those assets are distributed to that individual’s heirs
How is a Will Probated?
The process of probating a will is very straightforward and begins with the will being registered with the San Diego Probate Court Clerk’s Office. Generally speaking, the best thing to do is to hire an attorney and file a petition to open probate. The purpose of the petition is to say when the decedent died, and who should be appointed as executor or administrator, and to get a basic idea of what that that person’s assets are, whether it’s real property or personal property.
At that point, a hearing is scheduled where people can go in and object to the will. If no one does that, the judge will admit the will to probate and appoint an executor to administer the estate.
The executor does what you imagine an administrator would do; they will get a tax identification number from the Internal Revenue Service, open an estate bank account, and marshal all the assets, which means selling real estate and personal property and liquidating investment accounts and bank accounts. They will notify the decedent’s creditors that they have a certain amount of time to file a claim in the probate court, and when all claims are filed, the executor determines which ones to accept and pay and which ones to reject.
Once everything is done regarding the assets and the debts, the executor will then prepare a full accounting for the court of everything that’s happened and the court will schedule a hearing date at which people will be able to decide whether they approve the accounting or if they want to object. If no one objects and the judge approves the accounting, the judge will sign a court order declaring the compensation for the executor and the attorney and distributes the rest to the heirs.
If it’s approved that a piece of real estate is granted to Joe and Mary Smith, then the court order will pass title to Joe and Mary Smith; they now own the house. With regard to everything else, the executor will distribute the assets, whether they’re investment accounts, cash or personal property, and there will be other minor administrative tasks that must be completed after the accounting is approved and the judge signs a final court order, and there are other ministerial tasks that the attorney will have to take care of. So, that’s the basic probate process in a nutshell.
Why Is Probate Necessary?
The reason probate is necessary is quite simple. If you think about it, the only person who can sign your checks or access and transfer your investment account or buy or sell your real estate is you, so if something happens to you, whether you die or become incapacitated or disabled, no one can sign for you. The probate court provides someone to sign for you, that person being the judge.
If you’re deceased, the judge signs over your assets to your heirs; if you’re incapacitated or disabled, then the court will appoint a conservator to sign for you. The bottom line is that’s why we need probate.
Does All the Decedent’s Property Have to Go Through Probate?
The answer to that question is no; the assets that generally go through probate are those that are not jointly owned with somebody else, such as a spouse, or those without a beneficiary designation, such as a life insurance policy or a 401(k). Of course, if a life insurance policy or a 401(k) lists no beneficiary or if all beneficiaries named are deceased, then those assets will go through probate.
By and large, however, most assets, such as bank accounts, regular investment accounts, mutual funds and real estate will go through probate, because there is no mechanism for transfer to an heir so we need the judge to take care of that for us, to sign the assets over to the beneficiaries.
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