assignment of interest in probate estate california

Giving Up Your Inheritance: Assignment

As you probably already know, California allows you to disclaim your interest in an inheritance. Disclaiming an inheritance is simply the same as refusing an inheritance. If you disclaim your inheritance, it will be as if you “predeceased” the decedent, and the assets will be treated as though another person inherited them. In California, you can also make what is called an “assignment” if you do not want or need an inheritance. An assignment works differently from a disclaimer. Below is more about assigning inheritance.

What Is an Assignment of Inheritance?

If you receive an inheritance that you do not need or want, or if you receive an inheritance that you would prefer someone else receive, you can make an “assignment.” An assignment occurs when you transfer all or part of your inheritance to someone else.

The person making an assignment is known as an “assignor,” and the person receiving it is known as the “assignee.” Generally, an assignment is like a gift by the assignor to the assignee.

There are legal steps to be taken for an assignment to happen. An assignment is not an informal transfer. After all, transferring your inheritance to another person goes against what your deceased loved one designated or what California law requires based on familial relationships. Assignments are executed in writing and delivered to the executor of the estate. An assignment must be filed with the probate court before the transfer can be done.

If you are thinking of assigning your inheritance, you need to note that assignments create tax issues for both the assignor and assignee. Indeed, some tax issues can be avoided with an assignment, but you’d need to speak to a lawyer or tax advisor to determine the tax implications that apply to your case.

Reasons for Assignment

People assign assets for various reasons. The following are some of the reasons why people assign their interest in an inheritance;

• To avoid gift tax if they don’t plan to use the money themselves
• To exchange their inheritance for an immediate cash payment from a third party
• To give a share in the estate to an accidentally omitted beneficiary

Assignment vs. Disclaimer

As already mentioned, assignments are different from disclaimers. Firstly, when it comes to assignment, you inherit the property and then assign it. On the other hand, you do not get any share of the inheritance with a disclaimer.

Secondly, if you assign your inheritance, you can choose who gets it. You can assign your inheritance to anyone you want. On the other hand, when you disclaim your inheritance, you have no direct say in who gets it. If you disclaim an inheritance, the beneficiary or heir next in line will likely inherit it.

Lastly, there is no time frame for assignment, whereas you generally have nine months for a disclaimer.

Because there is no time frame for assignment, people who don’t want or need their inheritance, who accidentally pass the required nine months for a disclaimer, usually end up assigning their inheritance.

In conclusion, it is crucial to note that you cannot undo an assignment. In other words, transferring your inheritance rights is an irrevocable act.

Contact The Probate Guy

When it comes to assignments and disclaimers, making the right decision is easiest when you have the support of a skilled attorney. Contact the experienced and dedicated California probate attorney , Robert L. Cohen – The Probate Guy – to schedule a telephonic consultation.

More on Probate

• Mistakes To Avoid When Serving as an Executor (For 2024)
• Reopening Probate in California
• What Are the Benefits of Choosing a Probate Lawyer Near Me?
• Can You Use Alternative Dispute Resolution for Probate Issues?
• Burden of Proof in Will Contests
• February 2024
• January 2024
• December 2023
• Estate Planning
• Living Wills

I love being a probate attorney. I love helping people through a very difficult time in their lives with the probate process. My practice focuses solely on probate matters. My job is to complete the probate process as efficiently and painlessly for my clients as possible. I have found that paying the upfront costs of probate adds unneeded stress, so I will advance all of the fees and costs for the probate. No money is required to complete the probate. I will be reimbursed at the end of the case when you receive your inheritance. Call me NOW to discuss your case for free.

• Sacramento: 916.318.8000
• Oakland: 510.519.9000
• Newport Beach: 949.347.5000

What is a disclaimer of interest (Probate Code § 278)? 

A disclaimer of interest is, essentially, a written statement to the probate court where someone who stands to inherit property or assets states that they do not wish to exercise that inheritance. They “disclaim” any right to receive the interest that they otherwise would. 

Specifically, Probate Code section 275 provides: “A beneficiary may disclaim any interest, in whole or in part, by filing a disclaimer of as provided in this part.” 

Moreover, Probate Code section 278 states, “the disclaimer shall be in writing, shall be signed by the disclaimant, and shall: (a) Identify the creator of the interest. (b) Describe the interest to be disclaimed. (c) State the disclaimer and the extent of the disclaimer.” 

That said, executing a proper disclaimer is difficult to do, and with the complexities inherent to probate proceedings, securing the right attorney can make all the difference. At the Underwood Law Firm, our attorneys are well-versed in these matters and are ready to assist. As such, potential litigants should not hesitate to contact our office so that our team can begin helping you achieve your litigation goals. 

How does a disclaimer of interest work? 

When people with any assets or property die, they leave behind an “interest.” This interest is usually thought of as their property, both real and personal in nature. (Prob. Code § 267.) But, under the Probate Code, the term “interest” is actually quite broad. Yes, it does include real property and personal property, but it also refers to other assets and even fractional shares of those assets or property. ( Id .) 

It can also refer to legal interests or rights “related to property.” For instance, say someone is the successor trustee to a trust that contains the family home. When the trustee(s) pass away, that “right” of the successor trustee to begin managing the trust is, under the Probate Code, an interest. ( Id .) 

In turn, that means the successor trustee is one of perhaps many “beneficiaries.” A beneficiary is any person who is entitled to take an interest in the leftover estate. (Prob. Code § 262.) As a more straightforward example, if a parent leaves their home to their children under a will, then all of those children are beneficiaries under the code. 

This is where the disclaimer comes in. There is an interest that will be adjudicated by the probate court. And that interest will be taken by one or more beneficiaries, whomever they may be. Any of those beneficiaries can file a “disclaimer.” This disclaimer is any writing that declines, refuses, renounces, or disclaims any interest that would otherwise be taken by a beneficiary. (Prob. Code § 265.) 

Once filed, this former beneficiary is now referred to as a “disclaimant,” and they will receive none of the interest that they have disclaimed under the law. 

Why do people file disclaimers of interest? 

Given the circumstances in which a disclaimer is filed, one may ask why exactly anyone would want to disclaim an interest. Who would want to give up the chance to inherit property? 

The answer to such a question is actually quite complex. First, there are cases where beneficiaries are inheriting property absent the presence of a trust. The value of the property aside, owning real estate in California is very expensive. Property taxes and utilities alone can run households tens of thousands of dollars every year, and the simple truth is that not every beneficiary is able to accept that financial responsibility. 

This is not even considering the presence of a mortgage. If a lien is on the property in the form of a mortgage or deed of trust, that transfer to whomever eventually inherits the property. That is additional money that needs to be spent on maintaining the property every year. 

Lastly, there’s the federal estate tax. This is reserved for larger estates ($12.6 Million as of 2022), but it is yet another consideration that beneficiaries may be thinking of when mulling the possibility of a disclaimer. 

Inheriting property aside, there are also instances where multiple beneficiaries stand to inherit the right of becoming a trustee. Trustees are essentially those people who step in to manage a trustee once the former trustee (usually the person who created the trust) passes away. This, too, is a major responsibility, as trustees owe fiduciary duties to all other trust beneficiaries. ( O’Neal v. Stanislaus County Employees’ Retirement Assn. (2017) 8 Cal.App.5th 1184, 1209.) 

Because the trustee owes these duties, it means that they can be sued by other beneficiaries if they think the trustee is mismanaging the trust. ( Vance v. Bizek (2014) 228 Cal.App.4th 1155, 1160.) These are just some of the considerations one needs to take in when one stands to inherit an “interest” in probate court. In that context, a disclaimer makes more and more sense.

What is the procedure for disclaiming an interest? 

Because a disclaimer can often mean giving up property, which is incredibly valuable in California, properly filing one means adhering to strict statutory guidelines. 

First, the disclaimer needs to list three distinct items: (a) the identity of the creator of the interest, (b) a description of the interest to be disclaimed, and (c) a statement of the disclaimer and the extent of the disclaimer. (Prob. Code § 278.) Second, the disclaimer has to be filed within a certain time frame. In order for the court to consider the filing “reasonable,” the interest needs to be disclaimed within nine months of the death of the creator of the interest. (Prob. Code § 279.) 

The timing is also important because a beneficiary cannot “accept” the interest and then, later on, try to disclaim it. (Prob. Code § 285.) For instance, suppose Jack stands to inherit a house from his late mother, Jill. Jack cannot use the house as collateral to secure a loan and then subsequently disclaim any interest in the property. If a beneficiary accepts or takes actions indicating an acceptance of the interest, a disclaimer is not available. 

The other side of this coin is that someone cannot change their mind about a disclaimer. Under the law, a disclaimer provided it’s effective and wasn’t secured via fraud is irrevocable and binding upon the beneficiary. (Prob. Code § 281.) 

How the Underwood Law Firm Can Help

As each case is unique, probate beneficiaries would be well-served to seek experienced counsel familiar with the intricacies of the law surrounding succession and inheritance. At the Underwood Law Firm, our knowledgeable attorneys are here to help. If you are attempting to disclaim an interest, wondering whether you have already accepted one, or if you just have questions, please do not hesitate to contact our office .

Learn more here .

Download our free probate checklist. Download now

Settle an estate, without the guesswork.

Join the 100,000+ executors that have settled an estate sooner - using our step-by-step probate checklist

• U.S. (English)
• Canada (English)
• Canada (Français)

The 12 stages of the probate process in California

The probate process in california can be confusing and lengthy, we've laid it out for you in an easy 12-stage process. read our blog post below.

• Written by Chris Cambridge
• Posted on August 5, 2022

Fact Checked

The content on this page has been reviewed by qualified CFP's, TEP's, Tax accountants & Practicing and past lawyers to ensure it is factually accurate, meets current industry standards and helps readers achieve a better understanding of probate, estate planning, and estate taxes for your loved one.

A loved one, or someone that you were close to, has passed away and you, as the Executor, are legally responsible for spearheading the legal process that will distribute their assets, including any real estate, to their intended heirs.

In fact, you may be one of the heirs who will possibly be receiving a car, home, jewelry, artwork, money, or any other personal property that was owned by the person who died.

As the appointed Executor (hereinafter called the ‘Administrator’, as is standard in California) of the estate, and assuming that the deceased wasn’t your spouse, you are required to undertake the probate proceeding of the deceased’s will through the California Probate Court system.

California’s Judicial Branch operates under the auspices of the Superior Court of the county in which the deceased resided.

Before any assets are distributed to survivors, there are several specific steps that must be completed, including filling in any forms for filing. These are quite clear in nature, but they must be completed exactly as required, and most importantly , in the exact order that the Court specifies.

How to probate a will in California

These are the mandatory steps, in order, of the California probate process. However, be sure to review the order of the specific county probate process for the county that you are filing in, as some steps may be ordered slightly differently.

Step 1: File the petition

The petition must be filed in the county of residence for the deceased at the time of death. Upon making the filing (California form DE-111), the Court will officially be notified that a hearing needs to be scheduled regarding this matter. Typically, this takes place in about 30–40 days.

IMPORTANT NOTE:

• If the deceased left a will, a copy must be attached to the filing.
• In some cases, you may need to provide a death certificate.
• There is a $435 filing fee for the petition for probate. Some counties may charge a bit more and you can find the exact filing fee on the relevant Court's fee schedule.

Step 2: Publication of the notice of hearing

Following the filing of the probate petition, and as soon as is practicable after receiving a hearing date from the Court, a notice of the upcoming meeting must be published in the local newspaper a minimum of three times.

If there is a will, everyone named in it must be mailed a copy of the hearing notice. Additionally, all legal heirs of the deceased, whether they are mentioned in the will or not, as well as potential creditors, must receive by mail, a copy of the hearing notice.

Step 3: First probate hearing

At the initial probate hearing, the court decides who will be the Executor/Administrator/Personal Representative for the estate. These titles are interchangeable, but Administrator is more widely used in California.

In the probate petition, you may suggest who you believe the Administrator should be. Assuming that there was a will left by the deceased, the person named in it as Executor will, in all probability, be appointed by the Probate Court to represent the estate.

If there is no will, meaning that the deceased died " intestate ," or, if the Executor designated in the will chooses not to serve, then the Probate Court proceeding will rely on the Court to appoint an Administrator to lead the process. The closest living relative, or someone who will probably be a beneficiary, are the most likely candidates to be appointed.

Step 4: Be prepared to post a bond

It is likely that the Probate Court will require the Administrator to post a surety bond . If so specified, this must be completed with an authorized bond company before the Clerk of the Court will issue the " letters testamentary ," also known as "letters probate" or "letters administrative." These documents grant the Administrator the legal authority to proceed in handling the decedent’s estate.

The Court’s stipulation that the Administrator is bonded is to ensure that they execute their fiduciary responsibilities properly and completely. Bond prices are based on several factors, most importantly the amount that the Court requires, as well as your personal creditworthiness. If the Administrator lives in a state other than California, a bond will be required. You may, however, request a reduction in the amount of the bond if the Court can be assured that a large amount of the estate is secured by a savings account that is not subject to outstanding liens, and that it can only be accessed by a Court order.

The cost of the bond can be claimed as an expense by the Administrator and will be reimbursed when the estate is opened. Since the bond, if required, must be purchased before being officially assigned as the Administrator, that expense must initially come from personal funds.

Step 5: Proving the will

Proving a will means convincing the Probate Court that the will in question was undoubtedly authorized by the deceased person. In most cases, this is a smooth process, a formality, as the will would have been signed and dated by the deceased, with two or more witnesses present at the time.

The witnesses, who cannot be designated beneficiaries of the Will, should also have signed an attestation clause, making the will "self-proving." The Administrator can submit a self-proving will to the probate court, and no added testimony is needed to assure its validity.

On occasion, a Holographic Will ( handwritten ) is left by the testator/deceased, rather than a typed document. To prove that the handwriting is that of the deceased party, the court usually requires sworn testimony from someone who knew the deceased, and their handwriting, well.

A third type of will that the Court will accept is a statutory will. This is a pre-printed form that the now deceased person, or a representative, completed by filling in the blanks provided. This form needs to have been developed in accordance with California law, and again, signed in front of no fewer than two witnesses who are not designated beneficiaries of the will.

Step 6: Collection of assets

As the estate administrator, one of your most important responsibilities is to collect all of the eligible probate assets of the deceased; which may include personal property, vehicles, bank accounts with no beneficiaries, etc. Items that may not be included as probate assets include estate property, retirement accounts (IRA, 401k) that already have beneficiaries designated, property contained in a living trust, and funds/securities that are in pay-on-death accounts (POD) or transfer-upon-death accounts (TOD). If a beneficiary has pre-deceased the bank account holder, these items may be included in the probate case with the Court’s approval.

If the title (ownership) of an asset held by the deceased is required to be changed into someone else’s name, the Administrator must make these arrangements. Usually, to process a transfer of title, a death certificate must be presented.

The types of assets that may require a legal title change include, but are not limited to, stocks and bonds, bank and credit card accounts, brokerage accounts, and mutual funds.

Additionally, physical assets, ranging from the deceased’s primary residence, condos, vacation homes, motor vehicles, boats, aircraft, motorhomes, etc., will probably require the title to be transferred. Any transfer of property must be available for public review.

California form DE-160, Inventory and Appraisal, must be filed with the Court by the Administrator (personal representative). This form is your personal declaration that the items specified in the form are each and every asset in the decedent’s estate.

Step 7: Designation of probate referee

With rare exceptions, the Court will assign a Probate Referee or will require you to contact an authorized Probate Referee, so that any non-monetary assets can be professionally valued. If you do need to find a Probate Referee, be sure to contact someone who is court-approved for the county where the probate hearing is taking place.

Step 8: Payment to creditors

The Administrator provides notice to creditors with a formal notice of the decedent’s passing with form DE-157 , Notice of Administration to Creditors. Following its receipt, creditors may submit a written claim against the estate. Claims that are determined to be valid will be paid from the estate before any other distributions are made. This includes funeral expenses and any other outstanding bills.

California law requires creditors to submit all claims no later than four months after the Administrator has been appointed.

Step 9. Second hearing:

At the second hearing, if all has gone to plan, will involve the judges decision on final distribution of the estate.

Step 10: Sale of real property:

If real estate owned by the decedent is sold (liquidated), the Administrator may be required to file a form DE-260 , Report of Sale and Petition for Order Confirming Sale of Real Property.

Step 11: Payment of estate taxes

Ensuring that the deceased's personal income tax return has been filed, estate taxes and fees are paid, including Attorney fees, accounting fees, Federal and California imposed taxes.

If you need help calculating statutory probate fees in California, we've created a calculator to help you understand the attorney fees and executor compensation - you can access our probate fee calculator by clicking: here .

It is important that the estate taxes are paid on time, as the estate administrator may be held liable for not filing tax returns on time, or mismanaging estate assets. The Court may decide to impose personal liability on the estate administrator if they feel they have neglected this aspect of probate.

Step 12: Closing the estate

In this step of the probate procedure, the complicated and potentially long probate process is nearing completion. Closing the estate entails the Administrator providing a complete and final accounting that they have taken in this regard. The required petition that is filed as the concluding action of the Administrator will summarize all the actions that have been taken on behalf of the estate.

To conclude probate, a hearing is scheduled for the report to be presented to the Judge, who will in turn review if the Administrator has handled everything correctly and undergone careful accounting. The Judge will probably require receipts to show that the balance to beneficiaries has been paid and that any distribution of property to beneficiaries has been made. When the Judge is satisfied that all of the aspects of the probate filing have been successfully completed, the court will "discharge" the Administrator from his or her responsibilities.

Any appeal to the judgment must be filed within 60 days of the mailing or personal service of the entry of judgment.

As probate is a court-supervised process and with all of the above requirements necessary to complete it, you’re no doubt wondering if this will be a lengthy process. Depending on the complexity of the decedent’s estate, you can expect it to take anywhere from six months to possibly even two years. Should any unforeseen problems or unfavourable decisions (to some) arise, the process will be longer, however, if it is a simple estate to settle, everything should be processed quickly.

** Important to note for executors:

• Executors are entitled to reasonable compensation for fulfilling their duty as an estate administrator, however it is important to note that the executors compensation is taxable income and must be filed as such on your federal income tax return.

If you have any questions regarding the probate process you can reach out to us ; we're estate professionals specialized in probate administration in California. Alternatively, you can download our free 12 step blueprint to probating an estate in California below:

Need help with probate in California? Download our 12-step guide to settling an estate in California!

Chris Cambridge is a Senior Estate Professional here at ClearEstate. Credited with his Juris Doctor (J.D.), Master of Laws in Taxation (LL.M), and a Masters Degree in Trust and Wealth Management. He brings over 10 years of experience in estate planning and administration - Chris is able to accurately and empathetically guide you along your process of planning your estate.

Join the 100,000+ executors who have downloaded our free step-by-step blueprint to probate.

Related articles

Estate Settlement

Dec 19, 2023

How long does probate take in New York? (hint: up to 2 years)

Generally, most estates can take between 8 to 12 months to complete probate in New York. However, some cases can even take up to 2 years. Read on to find out more.

Nov 29, 2023

Here's What Happens If You Don't File Probate in California

Failing to file for probate in California can cause frozen assets, prolonged creditor claims, and possibly legal issues for an Executor. read on to learn more.

Oct 12, 2023

The Probate Timeline in Texas: How Long Does Probate Take?

Discover how long probate takes in Texas. Get insights into the process, factors affecting duration, and what to expect during probate.

(949) 639-9606

• Wills & Trusts
• Estate Planning
• Child Guardianship Planning
• Trust Administration
• California Pet Trusts

Answers to Frequently Asked Questions

What is a will.

A Will is a document where you indicate how you want your property distributed at your death. In a Will you designate who your beneficiaries and Personal Representative (a.k.a., Executor) will be. If you have not designated a person to serve as your Personal Representative in a Will, the Probate Court will designate a person to act as the Personal Representative with the authority to administer your probate estate.

For your convenience click HERE to view the California Statutory Will Form that is provided by the State Bar of California. Should you choose to use this form, please be careful to have the Will properly signed by two witnesses who are over the age of 18 and are not related to you.

Caution – A WILL DOES NOT AVOID PROBATE!

What is a Trust?

There are many different types of Trusts, but their common feature is that they all indicate how you want the trust assets managed and distributed to the beneficiaries.

The most popular type of Trust is called a Revocable Living Trust. As indicated in the name, a Revocable Living Trust can be changed or revoked entirely. It is called a "Living" Trust because it is created while you are alive. When the Trust is created, you are both the "Grantor" and the "Trustee." You're the one who transferred the assets into the Trust, and you're in control of your property. You will also designate "Successor Trustees" to be in charge of your assets when you are incapacitated and after you pass away.

One of the benefits of having a Trust versus a Will is that assets in a Trust do not go through Probate . This is because ownership of your property is transferred into the Trust, and you tell the Successor Trustee how to manage and distribute the assets. A court does not supervise the administration of the Trust. The only time your Successor Trustee should need to go to court is if there is ambiguity in the Trust document or if your beneficiaries contest the terms of the Trust.

What is Probate?

Probate is the court-supervised process of wrapping up one's affairs following their death. During this process, assets are inventoried and appraised, creditors are notified of the death, assets may need to be liquidated, debts are paid, and after attorney's fees and court costs are paid, any remaining assets are distributed to the beneficiaries. Because this is a court-supervised process paperwork must be filed with the court, affected parties must be served, and appearances are made before a judge. Unless sealed, all documents filed with the court are public information.

How much does Probate cost?

California lawmakers have imposed a minimum statutory fee that can be charged by attorneys in Probate cases. The fee schedule can be found at California Probate Code Section 10810. It is important to note that these fees are imposed on the GROSS value of the assets rather than the NET value. Therefore, encumbrances (debt) on the property are not taken into consideration when calculating the attorney's fees. Additionally, this schedule does not take into account the Personal Representative's (aka Executor) fees or additional compensation for extraordinary services that the Probate Court may choose to award.

What are the differences between a Will and a Trust?

Although both are instruments where you indicate how you want your property distributed, assets held in a Trust are not subject to Probate. If you only have a Will, then your remaining property will go through the probate process, and your Will becomes public record. Conversely, a Trust is a private document; since it is not recorded with the court, it can't be viewed by the public or by snooping family members.

Do I need a Trust?

This is another commonly asked question and the typical (and accurate) response is “it depends.” More completely, the answer depends on how expensive and complicated the Probate process will be after you pass away, and whether or not you want to prevent your family from dealing with the stress that's involved.

Without a Trust your assets may be subject to Probate before being distributed to your spouse or heirs. Probate can be a time consuming and frustrating process that can take from 9 months to several years and often requires the expertise of an attorney.

If you have few assets and you don't own a home, then the Probate process should be relatively straight forward and inexpensive. However, if you own a home or you have property valued in excess of $150,000 then you should have a Trust. California lawmakers have imposed a minimum statutory fee that can be charged by attorneys in Probate cases. The fee schedule can be found at California Probate Code Section 10810 and is illustrated in the table below.

As you can see, these statutory fees are owed to attorneys on a sliding scale based upon the value of the decedent’s assets. It is important to note that encumbrances (debt) on the property are not taken into consideration when calculating the attorney’s fees. Additionally, this schedule does not take into account the Personal Representative’s (aka Executor) fees or additional compensation for extraordinary services that the Probate Court may choose to award.

With a Trust your assets will be managed by your Trustee and distributed to your beneficiaries pursuant to your instructions. You determine who your Trustee and successor Trustees will be and the order of succession. You can easily change your Trustees by preparing an Amendment to your Trust. Your Trustee may be entitled to a fee but you decide how much the fee will be. In addition to freeing your loved ones of the expenses and burdens of Probate, you obtain the benefit of privacy by preventing your affairs from becoming public record in the Probate Court files. Finally, in almost all cases, the cost to prepare a revocable living trust is much less than the expenses of Probate.

Are there any income tax advantages of having a Trust?

A Revocable Living Trust is tax neutral and does not generate any tax advantages or consequences as long as the person who put the assets into the trust (commonly referred to as the Grantor, Trustor, or Settlor) is the primary beneficiary of the trust and retains the right to amend the trust. Satisfying these requirements makes the Trust a Grantor Trust for tax purposes, and all income and losses are reported on the Grantor's personal tax returns. However, once the Grantor passes away, the trust must obtain its own EIN, and it must file its own federal and state income tax returns. The federal income tax return for trusts is filed on Form 1041, and the California income tax return for trusts is Form 541.

Does a Trust provide asset protection from creditors?

A Revocable Living Trust does not provide asset protection from the creditors of the Grantor(s). There are other types of Trusts that can do this. However, a Revocable Living Trust can protect assets from the claims of your beneficiaries' creditors.

Doesn’t holding real property in “joint tenancy” avoid Probate?

Yes, but Probate is only avoided on the death of the first spouse. When the second spouse dies, the real property must go through Probate. If the house were placed into a trust while both spouses were alive, there would be no need for a Probate to be opened at either death. Additionally, there are negative capital gains tax consequences should the surviving spouse choose to sell the house, and it is held in joint tenancy.

Should I give my house to my children before I die in order to avoid Probate?

Video coming soon!

Feel free to call us if you have additional questions. (949) 639-9606

NO! Many people think that this is an easy solution to avoid forming a Trust. However, it is ripe with problems. 1) GIFT TAX - The gift to your children is a taxable event, and you must file a Form 709 Gift Tax Return. Any tax penalty associated with the transfer is owed by the transferor, not the recipient of the property. 2) CAPITAL GAINS TAX - Your children's tax basis in the property would be your basis in the property. This can have horrible consequences should your children eventually choose to sell the property. However, if they were to inherit the property upon your death, their basis in the property would be the fair market value at the time of your death. This could eliminate any capital gains taxes owed when they choose to sell the property. 3) CREDITORS - Placing your children on title to your house will make it accessible to the claims of your children's creditors. The tax consequences and potential risks generated by giving your house to your children substantially outweigh the expense of a properly prepared Trust. Click HERE for more information concerning joint ownership of property between generations.

I have a trust that was drafted ten years ago or more. Do I need a new one?

Most likely, yes. Due to the changes in tax laws that have occurred over the past ten years, it is very likely that your trust is outdated and doesn’t properly take these changes into account. For example, in 1999, the per person estate tax exclusion amount was $650,000. Today this amount is $5,450,000. Your estate plan was likely drafted based upon the size of your estate and the estate tax exclusion amount at that time.

Because the estate tax exclusion amount has changed significantly over time, and because married people can now take advantage of the "Portability" of the deceased spouse's unused estate tax exclusion amount, your trust likely needs to be updated.

We would be happy to review your existing estate plan documents and provide you with our opinion on the status of your existing estate plan.

I recently moved from another state. Can I still use my old Trust?

No. Probate and Trust laws vary significantly between states. Although your Trust may have a clause saying that the trust can use the governing laws of the state where you currently live, this can cause confusion in the Trust provisions. The most prudent thing to do is to consider it a moving expense and have the Trust redrafted under California law.

Why do I need to hire a lawyer if I can prepare my Trust online?

An estate planning attorney is aware of the current tax laws and potential changes in these laws. Every person’s situation is unique, and their estate plan should be drafted to account for the changing tax laws. Therefore, we do not believe in taking a one-size-fits-all approach to estate planning. Rather every Trust is custom drafted for our clients to accommodate their specific needs and desires. Additionally, having an estate planning attorney prepare your Trust will provide a continuity of advice and someone for spouses and beneficiaries to turn to for guidance during the time of grief and turmoil following the death of a loved one.

I’m not married. Why should I have a Trust?

How do you want to be remembered when you pass away? Someone will need to take care of your final affairs. Do you want to force your friends, family, or other loved ones to appear in court to resolve your affairs? Show your loved ones you care about them by having a well organized and up-to-date estate plan.

What documents are included in an estate plan?

People typically people think of Wills and Trusts in conjunction with estate planning. However, these are merely two components of a complete and cohesive estate plan. A properly prepared estate plan should include at least the following documents:

• Revocable Living Trust
• Certification of Trust
• Trust Summary
• Trust Funding Instructions
• Pour-Over Will
• Durable Power of Attorney
• Assignment of Personal Property
• Personal Property Memorandum
• Health Care Power of Attorney
• Advance Health Care Directive ( Click HERE )
• HIPAA Authorization
• Property Agreement (for spouses only)
• Deeds transferring real property into the Trust
• Remembrance and Services Memorandum ( Click HERE )

What is a Pour-Over Will?

A Will tells the Probate court how to distribute your assets upon your death. Whereas a "Pour-Over Will” pours any of the assets that were not placed in your Trust during your lifetime into the Trust upon your death to be administered and ultimately disposed of pursuant to the provisions of your Trust. A Pour-Over Will is basically a clean-up mechanism, not a substitute for transferring assets into your Trust during your lifetime, and any assets that are transferred to your Trust under your Pour-Over Will will likely be subject to Probate. REMINDER: WILLS DO NOT AVOID PROBATE. A PROPERLY FUNDED TRUST AVOIDS PROBATE.

What is a Certification of Trust?

When dealing with assets held in your Trust, third parties often want evidence that you are the Trustee and have the power to enter into the transaction at issue (e.g., selling real estate, opening a brokerage account, etc.). In such a case, providing the person with a copy of the Certification of Trust rather than the full Trust Agreement provides them with the information they need, and keeps private the information with respect to the Trust’s beneficiaries and the disposition of the assets in your Trust upon your death.

What is a General Durable Power of Attorney?

A General Durable Power of Attorney authorizes the person designated as your "Agent" to act on your behalf with respect to your financial affairs. The version of this document we prepare is sometimes called a “Springing” Power of Attorney. This is because your Agent is not immediately given the power to manage your financial affairs upon you signing this document. Rather, the power “springs” into effect upon your incapacity. California has instituted the Uniform Statutory Form Power of Attorney Act under California Probate Code Sections 4400 - 4465, which provides the public with a form that they can use to give another person the authority to make financial decisions on their behalf. Click HERE to view the California Statutory Power of Attorney Form. If you choose to use this form, please read it thoroughly and do not sign it if you are under duress to do so, or if you do not fully understand the financial authority being conveyed under this document. Also, this form needs to be notarized or signed by two disinterested witnesses. We do not use this form at Winstead Law Group, APC. Instead, we prefer to use Powers of Attorney that are specifically drafted for each client's unique needs.

What is a Health Care Power of Attorney?

A Health Care Power of Attorney allows you to designate those individuals who will make health care decisions for you upon your incapacity. These people are referred to as “Health Care Agents.”

What is an Advance Health Care Directive?

An Advance Health Care Directive (also commonly referred to as a “Living Will”, “Physician’s Directive”, or a “Directive to Physicians”) is where you convey to your Health Care Agent and health care personnel your desires concerning life sustaining treatment and anatomical gifts. Click HERE to view the California Statutory Advance Health Care Directive Form.

It is important to note that no amount of legal documentation and preparation can guarantee that your health care wishes are followed. This is a very sensitive topic where strong emotions are involved. Therefore the best advice we can provide is for you to ensure that your Health Care Agents know what your wishes are and that they are willing to follow your instructions despite any personal feelings they may have to the contrary.

What is a HIPAA Authorization?

“HIPAA” stands for Health Insurance Portability and Accountability Act. A HIPAA Authorization provides the Health Care Agent named in your Health Care Power of Attorney with access to your medical information. Hospitals generally will not release your medical information to anyone, including a spouse or close family member, unless they are provided with a HIPAA Authorization. You may choose to provide executed copies of the Health Care Powers of Attorney, Advance Health Care Directives, and HIPAA Authorizations to your health care providers for their information and to retain in your medical records.

What is an Assignment of Personal Property?

An assignment of Personal Property is a document that is used to transfer all of your tangible personal property into your Trust. However, the Assignment is not effective at transferring title to assets that have their own evidence of ownership, such as real estate, bank accounts, vessels, and automobiles, which need to be individually transferred to your Trust.

What is a Property Agreement?

A Property Agreement only applies to married people. The Property Agreement is designed to clarify the manner in which your assets are held, whether Community Property or Separate Property. There are tax advantages to holding property as Community Property. A Property Agreement IS NOT a substitute for a Post-Nuptial Agreement.

What is a Personal Property Memorandum?

A Personal Property Memorandum is a form that can be incorporated by reference into your Will and Trust and is used to indicate how you would like your personal effects (e.g., clothing, mementos, jewelry, furniture, art, etc.) to be distributed on your death. These forms provide flexibility to your estate plan. If you change your mind about distribution, you can either prepare a new Personal Property Memorandum or amend the existing one by striking through to the name of the beneficiary and the intended gift, and initialing and dating the strike-through. The use of these forms avoids the need to prepare a formal amendment to your Trust if you have a change of heart as to the disposition of your personal effects. To avoid confusion and potential litigation, please inform your spouse of your desires to distribute certain tangible items to individuals and provide a copy of your Personal Property Memoranda to your attorney.

How do I designate a legal guardian for my children?

Parents should prepare Wills and Powers of Attorney designating the Guardian of their children upon their death or incapacity. Although a judge will still need to sign off on the appointment, most courts will respect the parents’ wishes. In support of their decision, parents should also write a letter that explains their reasons for designating the particular person as their children’s Guardian. Click HERE to learn more about Child Guardianship Planning.

Can I exclude a person as the legal guardian of my minor child?

Yes, you can specifically exclude people as your child's legal guardian. However, please keep in mind that the Guardian must still be approved by a judge, and they likely won't consent to the exclusion of a child's parent without good cause. Ultimately, the judge's primary concern is whatever is in the best interests of the child.

Why should I choose to work with Winstead Law Group, APC?

We are a boutique tax, asset protection, and estate planning firm. We offer clients the expertise found at larger firms and the personalized attention that is rarely found at any law firm. Each of our clients is important to us, as is educating them with their legal matters. Our commitment to educating our clients means that each and every client is provided with individualized attention. Because we spend a lot of time with our clients, this added time is reflected in the cost of our services. However, we feel this time is well worth the expense, and our clients agree. Read our client reviews to hear what they have to say.

What can I expect if I choose Winstead Law Group, APC, to prepare my estate plan?

Our commitment to educating our clients means that each and every client is provided with individualized attention over several meetings designed to:

• 1 Introduce clients to the Estate Plan concept, helping them understand why they may, or may not, need an Estate Plan;
• 2 Obtain information needed to prepare a complete and cohesive Estate Plan designed to meet the client’s specific needs, objectives, and concerns;
• 3 Educate clients with the provisions contained in their documents by reviewing the draft version of the Estate plan documents with clients prior to the documents being signed and notarized;
• 4 Impress on clients the need to transfer assets into their Trust because an improperly funded Trust does not accomplish one of its primary goals – Probate Avoidance; and
• 5 Assist in funding their trust through advice, discussions with bankers and financial advisors, and ensuring that Deeds are prepared to transfer title to real property into the Trust.

Click HERE to view a diagram illustrating the typical estate planning process.

What is the cost of an estate plan?

No one likes to be billed hourly for legal services. Therefore, whenever possible, we set a flat rate fee prior to beginning legal representation. However, we do not think it is fair to work from a Fee Sheet. As each estate plan is unique, it is difficult to quote a price until sufficient information is obtained to understand the scope of services involved. Generally, estate plans for individuals fall in the $2,500 to $3,000 range, and estate plans for married persons cost around $3,500 to $4,000. Please understand that these prices directly reflect the complexity of the plan and the amount of time involved, not only in drafting the documents, but also in meetings, teleconferences, and recording Deeds with the County Recorder.

You are using an outdated browser. Please upgrade your browser to improve your experience.

Call or Text: 916-307-4627 Click to send an Email to John

• The Basic Probate Process in California
• Spousal (or domestic partner) Property Petition
• Probate Court Petition Options
• Decedent’s Dying with Assets Under $150,000
• Conservatorships and Guardianships
• Small Estate Affidavits
• Probates 7 Month Timeline
• Ancillary Probate
• Special Administration
• FREE California Legal Forms
• California Probate Fee Calculator
• Same Sex Marriage
• Heggstad Petitions in California
• 10 Steps in the California Trust Administration Process
• Trust and Estates Beneficiary Representation
• Trustee Liability
• Testimonials
• Out-of-Area Clients
• All of California
• Sacramento Office
• Roseville Office
• Bay Area Offices
• Southern California offices

Disclaimers in California Probates

Disclaimers are an incredible tool to be used in California estate planning, trust and probate law. Typically they are used after death in probate and trust administration settings. In some cases people call it “after death estate planning.” In any event it is a very powerful tool that not enough California attorneys know about. Below are my notes from my 2008 NBI seminar I presented on probate in California. As always contact me directly with questions or visit our website for more info at www.californiaprobate.info

• A disclaimer is a procedure whereby a beneficiary (including an estate or trust) may chose to give up a right to an asset by signing a written document so stating.  Disclaimers are sometimes written into the estate plan (such as a disclaimer trust) and other times are used after death to change an estate plan after death.
• A common example of a disclaimer is to reduce the taxable estate of a beneficiary.  Disclaiming, or renouncing one’s rights to the property, will cause the property (or at least a portion of it) to be taxed in the decedent’s estate rather than the disclaiming parties estate.
• A disclaimer may be made by the beneficiary or, if the beneficiary has a conservator, by the conservator by obtaining an order in the conservatorship under the substituted judgment rules.  Similarly a disclaimer on behalf of a minor or deceased person would be with Court order.
• A disclaimer can be a whole or partial interest in just about any asset or power.  That is, there are cases where the specific disclaiming of a power written into a will or trust can correct an error in drafting or change in law or facts. The list of interests includes, but is not limited to the following at PC 267:

i)                    by intestate succession;

ii)                   under a will;

iii)                 under a trust;

iv)                 by succession to a disclaimed interest;

v)                  by virtue of an election to take against a will;

vi)                 by creation of a power of appointment;

vii)               by exercise or nonexercise of a power of appointment;

viii)              by an inter vivos gift, whether outright or in trust;

ix)                 by surviving the death of a depositor of a Totten trust account or POD account;

x)                  under an insurance or annuity contract;

xi)                 by surviving the death of another joint tenant;

xii)               under an employee benefit plan;

xiii)              under an individual retirement account (IRA), annuity or bond;

xiv)             any other interest created by any testamentary or inter vivos instrument or by operation of law;

• There are specific requirements which must be followed for the disclaimer to be effective.  The basic requirements for a disclaimer are:

i)                    in writing;

ii)                   signed by the disclaimant;

iii)                 identify the creator of the interest;

iv)                 describe the interest to be disclaimed;

v)                  state the disclaimer and the extent of the disclaimer;

vi)                 must be filed within a “reasonable time;”

• The disclaimer must be filed within a reasonable time after the person able to disclaim acquires knowledge of the interest.  PC 279(b) provides that, for certain specified interests, a disclaimer is conclusively presumed to be filed within a reasonable time if it is filed within nine months after the decedent’s death or within nine months after the interest becomes fully vested.
• If the disclaimer is not filed within nine months after the decedent’s death or within nine months after the interest becomes fully vested, the disclaimant has the burden of establishing that the disclaimer was filed within a reasonable time after the disclaimant acquired knowledge of the interest.
• The disclaimer must be filed in the Superior Court in the county in which the estate of the decedent is administered, with the trustee, PR, other fiduciary, or person responsible for distributing the interest to the beneficiary, with any other person having custody or possession of or legal title to the interest, or with the creator of the interest. (PC 280)
• If the disclaimer affects real property or an obligation secured by real property, the disclaimer should be notarized and recorded in the county in which the property is located.
• An effective disclaimer is irrevocable and binding upon the beneficiary and all persons claiming by, through, or under the beneficiary, including creditors of the beneficiary. (PC 281)
• The disclaimed interest passes in accordance with the provisions of PC 282, which provides:

“(a) Unless the creator of the interest provides for a specific disposition of the interest in the event of a disclaimer, the interest disclaimed shall descend, go, be distributed, or continue to be held (1) as to a present interest, as if the disclaimant had predeceased the creator of the interest or (2) as to a future interest, as if the disclaimant had died before the event determining that the taker of the interest had become finally ascertained and the taker’s interest indefeasibly vested. A disclaimer relates back for all purposes to the date of the death of the creator of the disclaimed interest or the determinative event, as the case may be. (b) Notwithstanding subdivision (a), where the disclaimer is filed on or after January 1, 1985: (1) The beneficiary is not treated as having predeceased the decedent for the purpose of determining the generation at which the division of the estate is to be made under Part 6 (commencing with Section 240 ) or other provision of a will, trust, or other instrument. (2) The beneficiary of a disclaimed interest is not treated as having predeceased the decedent for the purpose of applying subdivision (d) of Section 6409 or subdivision (b) of Section 6410 .

•    A disclaimer is ineffective if the beneficiary has accepted the interest sought to be disclaimed.  PC 285 provides that an acceptance occurs if:

(a) A disclaimer may not be made after the beneficiary has accepted the interest sought to be disclaimed. (b) For the purpose of this section, a beneficiary has accepted an interest if any of the following occurs before a disclaimer is filed with respect to that interest: (1) The beneficiary, or someone acting on behalf of the beneficiary, makes a voluntary assignment, conveyance, encumbrance, pledge, or transfer of the interest or part thereof, or contracts to do so; provided, however, that a beneficiary will not have accepted an interest if the beneficiary makes a gratuitous conveyance or transfer of the beneficiary’s entire interest in property to the person or persons who would have received the property had the beneficiary made an otherwise qualified disclaimer pursuant to this part. (2) The beneficiary, or someone acting on behalf of the beneficiary, executes a written waiver under Section 284 of the right to disclaim the interest. (3) The beneficiary, or someone acting on behalf of the beneficiary, accepts the interest or part thereof or benefit thereunder. (4) The interest or part thereof is sold at a judicial sale. (c) An acceptance does not preclude a beneficiary from thereafter disclaiming all or part of an interest if both of the following requirements are met: (1) The beneficiary became entitled to the interest because another person disclaimed an interest. (2) The beneficiary or other person acting on behalf of the beneficiary at the time of the acceptance had no knowledge of the interest to which the beneficiary so became entitled. (d) The acceptance by a joint tenant of the joint tenancy interest created when the joint tenancy is created is not an acceptance by the joint tenant of the interest created when the joint tenant survives the death of another joint tenant.

• It must be an irrevocable and unqualified refusal to accept an interest in property.
•  The written refusal must be received by the transferor, his legal representative, or holder of legal title no more than nine months after the later of (1) the day on which the transfer creating the interest is made; or (2) the day on which the person making the disclaimer reaches age 21.  A disclaimer of an interest created by a decedent’s will must be made within nine months of the date of the decedent’s death, not within nine months after the will was admitted to probate.
• The person making the disclaimer must not have accepted the interest or any of its benefits prior to the disclaimer.
• The interest must pass to a person other than the person making the disclaimer as a result of the refusal to accept the property. A surviving spouse may, under this rule, disclaim an interest that, as a result and without direction on his or her part passes to a trust in which the surviving spouse has an interest (i.e. a “disclaimer trust.”).

PRACTICE POINTER:  Try to complete disclaimers within nine months of death. Try to get notarized to help establish when it was done if it was not a disclaimer that needs to be filed in the Court.  If you are meeting with surviving spouse who has a “disclaimer trust” make sure you advise in writing about doing the disclaimer within 9 months!

• April 2024  (3)
• March 2024  (2)
• February 2024  (1)
• January 2024  (4)
• December 2023  (1)
• May 2023  (1)
• March 2023  (1)
• February 2023  (1)
• January 2023  (1)
• December 2022  (1)
• October 2022  (2)
• September 2022  (1)
• August 2022  (2)
• May 2022  (1)
• April 2022  (3)
• September 2021  (1)
• August 2021  (1)
• May 2021  (1)
• April 2021  (1)
• February 2021  (1)
• January 2021  (1)
• December 2020  (5)
• November 2020  (3)
• October 2020  (4)
• September 2020  (1)
• August 2020  (3)
• July 2020  (4)
• June 2020  (4)
• May 2020  (3)
• April 2020  (25)
• March 2020  (8)
• February 2020  (1)
• January 2020  (2)
• December 2019  (1)
• November 2019  (2)
• October 2019  (4)
• May 2019  (2)
• April 2019  (2)
• March 2019  (2)
• February 2019  (2)
• January 2019  (1)
• December 2018  (1)
• November 2018  (2)
• October 2018  (1)
• September 2018  (3)
• August 2018  (4)
• April 2018  (2)
• March 2018  (4)
• February 2018  (1)
• January 2018  (4)
• December 2017  (1)
• October 2017  (1)
• September 2017  (1)
• August 2017  (1)
• June 2017  (1)
• April 2017  (1)
• March 2017  (2)
• February 2017  (1)
• January 2017  (2)
• December 2016  (2)
• November 2016  (1)
• October 2016  (1)
• September 2016  (2)
• August 2016  (1)
• July 2016  (1)
• June 2016  (1)
• April 2016  (1)
• March 2016  (1)
• February 2016  (1)
• January 2016  (1)
• December 2015  (3)
• November 2015  (2)
• October 2015  (1)
• September 2015  (1)
• July 2015  (1)
• June 2015  (1)
• May 2015  (1)
• April 2015  (1)
• March 2015  (2)
• February 2015  (2)
• January 2015  (1)
• December 2014  (1)
• November 2014  (1)
• October 2014  (1)
• September 2014  (1)
• August 2014  (3)
• June 2014  (2)
• May 2014  (2)
• April 2014  (1)
• March 2014  (3)
• February 2014  (2)
• January 2014  (7)
• December 2013  (2)
• November 2013  (2)
• October 2013  (4)
• September 2013  (4)
• August 2013  (2)
• July 2013  (8)
• June 2013  (5)
• May 2013  (5)
• April 2013  (9)
• March 2013  (5)
• February 2013  (4)
• January 2013  (7)
• December 2012  (10)
• November 2012  (9)
• October 2012  (10)
• September 2012  (9)
• August 2012  (23)
• July 2012  (20)
• June 2012  (19)
• May 2012  (37)
• April 2012  (31)
• March 2012  (27)
• February 2012  (20)
• January 2012  (24)
• December 2011  (30)
• November 2011  (18)
• October 2011  (33)
• September 2011  (45)
• August 2011  (16)
• July 2011  (2)
• June 2011  (2)
• May 2011  (5)
• April 2011  (5)
• March 2011  (2)
• December 2010  (4)
• November 2010  (1)
• October 2010  (2)
• September 2010  (1)
• August 2010  (2)
• July 2010  (3)
• June 2010  (2)
• May 2010  (4)
• April 2010  (1)
• March 2010  (2)
• February 2010  (2)
• January 2010  (4)
• December 2009  (3)
• November 2009  (3)

Useful Links | Privacy Policy

Get a free copy of California Probate book

Your Name (required)

Your Email (required)

Your Message

• Find a Lawyer
• Ask a Lawyer
• Research the Law
• Law Schools
• Laws & Regs
• Newsletters
• Justia Connect
• Pro Membership
• Basic Membership
• Justia Lawyer Directory
• Platinum Placements
• Gold Placements
• Justia Elevate
• Justia Amplify
• PPC Management
• Google Business Profile
• Social Media
• Justia Onward Blog

2020 California Code Probate Code - PROB DIVISION 6 - WILLS AND INTESTATE SUCCESSION PART 2 - INTESTATE SUCCESSION CHAPTER 1 - Intestate Succession Generally Section 6401.

(a) As to community property, the intestate share of the surviving spouse is the one-half of the community property that belongs to the decedent under Section 100.

(b) As to quasi-community property, the intestate share of the surviving spouse is the one-half of the quasi-community property that belongs to the decedent under Section 101.

(c) As to separate property, the intestate share of the surviving spouse is as follows:

(1) The entire intestate estate if the decedent did not leave any surviving issue, parent, brother, sister, or issue of a deceased brother or sister.

(2) One-half of the intestate estate in the following cases:

(A) Where the decedent leaves only one child or the issue of one deceased child.

(B) Where the decedent leaves no issue, but leaves a parent or parents or their issue or the issue of either of them.

(3) One-third of the intestate estate in the following cases:

(A) Where the decedent leaves more than one child.

(B) Where the decedent leaves one child and the issue of one or more deceased children.

(C) Where the decedent leaves issue of two or more deceased children.

(Amended by Stats. 2014, Ch. 913, Sec. 32. (AB 2747) Effective January 1, 2015.)

Get free summaries of new opinions delivered to your inbox!

• Bankruptcy Lawyers
• Business Lawyers
• Criminal Lawyers
• Employment Lawyers
• Estate Planning Lawyers
• Family Lawyers
• Personal Injury Lawyers
• Estate Planning
• Personal Injury
• Business Formation
• Business Operations
• Intellectual Property
• International Trade
• Real Estate
• Financial Aid
• Course Outlines
• Law Journals
• US Constitution
• Regulations
• Supreme Court
• Circuit Courts
• District Courts
• Dockets & Filings
• State Constitutions
• State Codes
• State Case Law
• Legal Blogs
• Business Forms
• Product Recalls
• Justia Connect Membership
• Justia Premium Placements
• Justia Elevate (SEO, Websites)
• Justia Amplify (PPC, GBP)
• Testimonials

• Business Succession Planning
• Legacy and Estate Planning California
• Planned Giving
• Special Needs Planning
• Trust and Probate Administration
• BUSINESS SUCCESSION PLANNING
• CALIFORNIA LEGACY AND ESTATE PLANNING
• PLANNED GIVING
• TRUST AND PROBATE ADMINISTRATION
• SPECIAL NEEDS PLANNING
• Testimonial

Transferring Inheritance Rights

In special circumstances a beneficiary may want to transfer inheritance rights to another.   Let us examine when, why and how such transfers can take place.

Consider an heir to a deceased person’s intestate estate (i.e., a person who died without a will).   Sometimes, an heir may want to transfer his/her inheritance rights to the following types of recipients:   An “heir search” firm; the decedent’s intended beneficiary; or to another family relative. Let’s discuss.

When a person without a will or trust dies and not all of the decedent’s lawful heirs step forward, an heir search firm may step in.   Using genealogical records, heir search firms find the missing heirs.    For example, take an unmarried decedent with no surviving descendants or siblings.   An heir search firm may find and notify the nieces and nephews or even cousins, as relevant.   Naturally, the heir search firm requests the missing heirs assign a percentage of their inheritance rights to the heir firm.   Assignments are legal if they satisfy certain standards.

Next, occasionally the heirs may wish to assign their rights to the decedent’s intended beneficiary. Take a decedent who, while alive, orally declared his intention to leave everything to his then girlfriend and companion of ten years.   Unfortunately for her, he never formalized his spoken intentions.   The heirs may — and I have seen this happen — choose to honor the decedent’s spoken intentions. To do so they may “assign” her their inheritance rights; in which case she steps into their shoes.  

Now consider a death beneficiary to a living trust.   Can the beneficiary transfer his or her beneficial interest in the trust estate?   It depends.  

Sometimes the trust gives a beneficiary a “power of appointment” to transfer the inheritance to alternative beneficiaries of choice; this is to allow the intended beneficiary to pick alternative beneficiaries should he or she not survive to receive his/her full inheritance.   To exercise a power of appointment, the power holder must execute a testamentary instrument and therein specifically refer to the power of appointment being exercised.

Powers of appointment are either limited or general.   Limited powers of appointment allow the power holder the right to transfer some or all of an inheritance to a narrow class of persons, typically the power holder’s siblings or children.   General powers of appointment, however, allow the power holder to transfer his inheritance rights to anyone, including his estate and his creditors.    

Without a power of appointment it is often impossible for the beneficiary to assign his/her inheritance because a trust will typically contain an “anti-alienation” clause.   This clause prevents a death beneficiary from assigning his or her inheritance rights – prevents the beneficiary’s creditors from compelling the trustee to satisfy the beneficiary’s own debts directly from the trust (prior to distribution to the beneficiary).

Nevertheless, even with an anti-alienation clause, a trust beneficiary may sometimes still “disclaim” – renounce — his or her beneficial interest within a 9 month period after the settlor of the trust dies. A properly executed disclaimer causes the disclaimed interest to pass as if the beneficiary had predeceased the settlor.   Consequently an alternative beneficiary inherits the disclaimed property.   However, unlike with an assignment or exercise of a power of appointment, the disclaiming beneficiary may not direct who inherits; he or she can only step aside.

Before transferring an inheritance by executing an assignment, power of appointment, or disclaimer, as the case may be, one should consult with a qualified attorney.   Not only must the legal procedure be done correctly, but persons making such transfers need to understand the implications to themselves.  

“Serving Lake and Mendocino Counties for nineteen years, the Law Office of Dennis Fordham focuses on legacy and estate planning, trust and probate administration, and special needs planning. We are here for you. 870 South Main Street Lakeport, California 95453-4801. Phone: 707-263-3235.”

Practice Areas

• Legacy and Estate Planning

Upcoming Events

Why a Trust and Not a Will? Seminar

Community Event Announcement

Please call if you want to be notified of our next upcoming seminar.

Event Sign Up

Stay current on news & events. we’ll never share your address..

• Enter Email

© 2024 Dennis A. Fordham All Rights Reserved

• Election 2024
• Entertainment
• Newsletters
• Photography
• Personal Finance
• AP Investigations
• AP Buyline Personal Finance
• Press Releases
• Israel-Hamas War
• Russia-Ukraine War
• Global elections
• Asia Pacific
• Latin America
• Middle East
• Election Results
• Delegate Tracker
• AP & Elections
• March Madness
• AP Top 25 Poll
• Movie reviews
• Book reviews
• Personal finance
• Financial Markets
• Business Highlights
• Financial wellness
• Artificial Intelligence
• Social Media

If OJ Simpson’s assets go to court, Goldman and Brown families could be first in line

O.J. Simpson, the football star and Hollywood actor who was acquitted of charges he killed his former wife and her friend in a trial that mesmerized the American public but was found liable in a separate civil case, has died.

FILE - Fred Goldman, father of Ron Goldman, hugs his wife Patti, as his daughter, Kim, left, reacts during the reading of the not guilty verdicts in O.J. Simpson double-murder trial in Tuesday, Oct. 3,1995, in Los Angeles. Simpson was acquitted in the murders of Goldman and Simpson’s ex-wife Nicole. Foreground is Los Angeles Police Detective Tom Lange, co-lead investigator in the case. Simpson, the decorated football superstar and Hollywood actor who was acquitted of charges he killed his former wife and her friend but later found liable in a separate civil trial, has died. He was 76. (Myung J. Chun/Los Angeles Daily News via AP, Pool, File)

• Copy Link copied

FILE - In this July 20, 2017 file photo, former NFL football star O.J. Simpson reacts after learning he was granted parole at Lovelock Correctional Center in Lovelock, Nev. Simpson, the decorated football superstar and Hollywood actor who was acquitted of charges he killed his former wife and her friend but later found liable in a separate civil trial, has died. He was 76. (Jason Bean/The Reno Gazette-Journal via AP, Pool, File)

FILE - In this Oct. 3, 1995, file photo, O.J. Simpson reacts as he is found not guilty in the death of his ex-wife Nicole Brown Simpson and her friend Ron Goldman in Los Angeles. Defense attorneys F. Lee Bailey, left, and Johnnie L. Cochran Jr. stand with him. Simpson, the decorated football superstar and Hollywood actor who was acquitted of charges he killed his former wife and her friend but later found liable in a separate civil trial, has died. He was 76. (Myung J. Chun/Los Angeles Daily News via AP, Pool, File)

FILE - O.J. Simpson and his wife, Nicole Brown Simpson, arrive for the opening of the Harley-Davidson Cafe in New York on Oct. 19, 1993. Simpson, the decorated football superstar and Hollywood actor who was acquitted of charges he killed Nicole Brown Simpson and her friend but later found liable in a separate civil trial, has died. He was 76. (AP Photo/Paul Hurschmann, File)

LOS ANGELES (AP) — O.J. Simpson died Wednesday without having paid the lion’s share of the $33.5 million judgment a California civil jury awarded to the families of his ex-wife Nicole Brown Simpson and her friend Ron Goldman .

Acquitted at a criminal trial, Simpson was found liable by jurors in a 1997 wrongful death lawsuit.

The public is now likely to get a closer look Simpson’s finances, and the families are likely to have a better shot at collecting — if there is anything to collect.

Here’s how the next few months may play out.

THE PROBATE PROCESS

In this July 20, 2017 file photo, former NFL football star O.J. Simpson reacts after learning he was granted parole at Lovelock Correctional Center in Lovelock, Nev. (Jason Bean/The Reno Gazette-Journal via AP, Pool, File)

Whether or not he left behind a will, and whatever that document says, Simpson’s assets will now almost certainly have to go through what’s known as the probate process in court before his four children or other intended heirs can collect on any of them.

Different states have different probate laws. Generally, the case is filed in the state where the person was living when they died. In Simpson’s case that’s Nevada. But if significant assets are in California or Florida, where he also lived at various times, separate cases could emerge there.

Nevada law says an estate must go through the courts if its assets exceed $20,000, or if any real estate is involved, and this must be done within 30 days of the death. If a family fails to file documents, creditors themselves can begin the process.

A STRONGER CLAIM IN DEATH?

Fred Goldman, father of Ron Goldman, hugs his wife Patti, as his daughter, Kim, left, reacts during the reading of the not guilty verdicts in O.J. Simpson double-murder trial in Tuesday, Oct. 3,1995, in Los Angeles. (Myung J. Chun/Los Angeles Daily News via AP, Pool, File)

Once the case is in court, creditors who say they are owed money can then seek a piece of the assets. The Goldman and Brown families will be on at least equal footing with other creditors, and will probably have an even stronger claim.

Under California law, creditors holding a judgment lien like the plaintiffs in the wrongful death case are deemed to have secured debt, and have priority over creditors with unsecured debt. And they are in a better position to get paid than they were before the defendant’s death.

Arash Sadat, a Los Angeles attorney who specializes in property disputes, says it is “100%” better for the claimant to have the debtor be deceased and their money in probate.

He said his firm had a jury trial where their clients got a $9 million jury award that the debtor appealed and delayed endlessly.

”He did everything he could to avoid paying this debt,” Sadat said. “Three or four years later, he died. And within weeks, the estate cuts a check for $12 million. That’s the $9 million plus interest that I had accrued over this time.”

The executor or administrator of the estate has much more of an incentive to dispense with debts than the living person does. “That’s why you see things like that happening,” Sadat said.

But of course that doesn’t mean payment will be forthcoming.

“I do think it’s going to be quite difficult for them to collect,” attorney Christopher Melcher said. “We don’t know what O.J. has been able to earn over the years.”

Neither Sadat nor Melcher is involved with the Simpson estate or the court case.

WHAT ASSETS DID SIMPSON HAVE?

In this Oct. 3, 1995, file photo, O.J. Simpson reacts as he is found not guilty in the death of his ex-wife Nicole Brown Simpson and her friend Ron Goldman in Los Angeles. Defense attorneys F. Lee Bailey, left, and Johnnie L. Cochran Jr. stand with him. (Myung J. Chun/Los Angeles Daily News via AP, Pool, File)

Simpson said he lived only on his NFL and private pensions. Hundreds of valuable possessions were seized as part of the jury award, and Simpson was forced to auction his Heisman Trophy, fetching $230,000.

Goldman’s father Fred Goldman , the lead plaintiff, always said the issue was never the money, it was only about holding Simpson responsible. And he said in a statement Thursday that with Simpson’s death , “the hope for true accountability has ended.”

WHAT ABOUT TRUSTS?

O.J. Simpson and his wife, Nicole Brown Simpson, arrive for the opening of the Harley-Davidson Cafe in New York on Oct. 19, 1993. (AP Photo/Paul Hurschmann, File)

There are ways that a person can use trusts established during their life and other methods to make sure their chosen heirs get their assets in death. If such a trust is irrevocable, it can be especially strong.

But transfers of assets to others that are made to avoid creditors can be deemed fraudulent, and claimants like the Goldman and Brown families can file separate civil lawsuits that bring those assets into dispute.