THE ATTORNEY'S CORNER: AVOIDING PROBATE, PLUS SUMMARY DISSOLUTION

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“Your source for Trusts, Wills, Probate, Family Law & more”

By Stephen C. Ross, Esq.

March 16, 2013 (San Diego County) – Probate is a legal proceeding whereby the court ensures the decedent's assets are collected, creditors paid and the remaining assets distributed pursuant to the terms of the decedent's will. If the decedent died without a will (intestate), the estate assets will be distributed pursuant to the California law of intestate succession.

AVOIDING PROBATE

Probate proceedings can be long, costly, and stressful to the estate’s personal representative. However, there are ways to avoid probate in California. They include the following:

1.  Revocable Trust: A competent adult can create a revocable trust to avoid probate of his or her assets. The trust document must be properly prepared naming someone to act as trustee after your death and indicating when, how and to whom you want your assets to be distributed. Your estate will avoid probate and be controlled pursuant to the terms of the trust if you have transferred ownership of your assets to yourself as trustee of the trust.

2.  Joint Ownership: When one or more people own property jointly, and the ownership includes the "right of survivorship," the surviving owner(s) automatically own(s) the property when one or more of the owners die. The two forms of this joint ownership in California, include:

• Joint tenancy. Joint tenancy property automatically passes to the surviving owners when one owner dies. No probate is required. Each owner (joint tenant) must own an equal share.

• Community property with right of survivorship. California is a community property state. Therefore, unless steps have been taken to keep property separate, all property acquired during the marriage is owned jointly. If the property is owned jointly with right of survivorship, it automatically passes to the survivor when one spouse or partner dies.

3.  Payable on Death Accounts: You can add a "payable-on-death" (POD) designation to your California bank accounts. You control all the money in the POD account and can spend it all if you want. The POD beneficiary does not have any right to the money during your lifetime. However, the beneficiary can claim the money at your death without probate.

4.  Transfer-on-Death Securities Registration: You can register stocks and bonds in transfer-on-death (TOD) form. Registering an account in TOD (beneficiary) form, allows the beneficiary you name to inherit the account automatically at your death without probate. You can register a vehicle in California in TOD form allowing the named beneficiary to inherit the vehicle after your death without probate.

5.  Summary Probate: With certain exceptions, if the gross value of decedent’s California real and personal property does not exceed $150,000.00 and 40 days have passed since decedent’s death, the successor to decedent’s property may, without probate, collect money due the decedent and receive decedent’s tangible personal property.

6.  Gift Assets: In 2013, every person can make a gift to any number of people up to $14,000.00, each, without incurring gift tax. The amount gifted is effectively taken out of your estate and is not subject to probate after your death.

SUMMARY DISSOLUTION

California provides a simplified dissolution of marriage procedure to couples meeting certain requirements. The summary dissolution procedure is a fairly straightforward, inexpensive way to dissolve a marriage without formal court hearings. The requirements for summary dissolution, include:

1.   At least one of the parties has been a resident of California for at least six months and of the county where the petition is filed for at least three months prior to filing the dissolution petition;

2.   Irreconcilable differences have caused an irremediable breakdown of the marriage and the marriage should be dissolved;

3.   There are no children of the relationship born before or during the marriage or adopted during the marriage and the wife, to her knowledge, is not pregnant;

4.   The marriage lasted no longer than five years from the date of marriage to the date of separation;

5.   Neither party has an interest in real property other than a residential lease that will terminate within one year from the date the dissolution petition is filed and does not include an option to purchase;

6.   There are no unpaid debts incurred by either or both parties during the marriage in excess of $6,000.00, excluding the balance of an automobile purchase;

7.   With certain exceptions, the fair market value of all community property is less than $38,000.00 and neither party has separate property in excess of $38,000.00;

8.   The parties have signed an agreement dividing their community assets and debts and the documents required to effectuate their property settlement agreement;

9.   Both parties waive the right to spousal support;

10. Both parties waive the right to appeal or move for a new trial;

11. The parties have read and understand the Judicial Council Summary Dissolution Information booklet; and,

12. The parties want the court to dissolve their marriage.

Stephen represents estate planning, trust, will, probate, trust administration, business formation, stepparent adoption and family law matters. He conducts estate planning and probate seminars throughout San Diego County. For more information or to schedule a seminar contact Stephen at (619) 795-8524, stephen@stephenrosslaw.com or visit www.stephenrosslaw.com.

Disclaimer: Information contained in this article is believed to be accurate. However, you should seek professional legal advice before relying on the information.


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