What Are The Available Options To Avoid Probate In California?
There are quite a number of options to avoid probate. Many people, in an effort to avoid attorney’s fees, put all of their property in what is called joint tenancy. They put their bank account in the name of their sister. They put their house in joint tenancy with their children, since joint tenancy is an area that is outside of the jurisdiction of the probate court. The property passes by operation of law. In a joint tenancy, the joint tenants are deemed to jointly own their property such that if one person dies, that person no longer owns the property and the other people continue to own it jointly. This is a very simple method that people use. It is convenient and it is cheap, but it is usually a mistake.
There are some tax issues with a joint tenancy and secondly, it does not allow the person who would otherwise be the trustor or settlor to direct the property or the value of the property to go where the decedent wanted. For example, at one point in time, two sisters put a property in their joint names. One sister is married and has two children. The married sister is thinking that her share will go to her own children if she dies. It will not. It will go to her sister instead if that sister is the survivor.
As a matter of law, it is difficult to challenge a joint tenancy that has existed on a deed in public record. So the joint tenancy angle is a very poor estate planning device.
Another way one can avoid probate is to start to distribute your assets by gifts before you pass away. Of course, for that to work, you actually have to give it away. It is possible to use some kinds of irrevocable trusts, but the trustor must still give up most control of the property.
People also use accounts which are called payable on death. In these accounts, someone is designated as a pay on death payee and that person will receive what is in the account. Of course, this can frustrate the intentions of the decedent. You can put assets in a charitable remainder trust and use the money for life. When you die, all the remaining money goes to charity. That money will escape probate and it will not be part of your estate.
Finally, of course, there is a trust, assuming that the trust is complete. It identifies the trustor or settlor, it is signed, and it should be notarized to make it clear who signed the trust. This also assumes that the assets are transferred to the trust. While a trust is not the only answer, for many people, it is the best answer.
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