As of January 1, 2012, California Probate Code section 13100 has been updated to allow for small estate transactions where the estate does not exceed $150,000.  This increase in dollar amount should help us avoid the need to open a probate for small estates and to claim assets in a much easier manner.

It is likely however that banks and financial institutions will be resistant and unaware of this change.  Most financial institutions have pre-printed forms which list the old $100,000 limit on them.  Unless the financial institution has updated their forms, the clerks processing the paperwork will be unaware of the change and refuse to process transactions in excess of $100,000 but less than $150,000.  In addition, for financial institutions out of state, it is likely that they will also be resistant to processing a transfer in excess of $100,000 and will need to be educated as to the recent change in California law.  While we may have to educate the financial institutions regarding the law change, overall this new law will greatly ease some of the estate administration issues and avoid the need for probate proceedings for estate less than $150,000.

Unlike cash or other financial assets which can typically be easily divided between the children, tangible items are much more difficult to divide.  With only one piano or grandfather clock, who will receive those items when there are four children?  Trustees and estate administrators struggle with how to divide up the items, especially if the decedent left no specific instructions regarding their distribution.  In addition, the trustee is often struggling with their own grief and personal memories which are attached to some of the personal property items, and may find themselves having difficulties achieving an equitable division.

Jennifer Modenessi’s article Dividing Up a Life’s Worth of Memories (11 September 2011, Living Section) in  the San Jose Mercury News    discussed dividing up personal property following a parent’s passing and how difficult that process can be.  I find that in my practice, older estate planning documents tend not to mention the division of the personal property while current estate plans will often contain some sort of direction particularly regarding certain items.  When drafting estate plans, I do encourage clients to consider keeping a list which will indicate to whom certain items should be distributed.

However, for my administration clients, as there is typically little or no direction coming from the documents, I have to advise my clients to find a method which may work for them and their families to equitably divide up the personal items.  There is no one solution that will work for everyone, however it remains in everyone’s best interest to work through the difficult task of dividing up the personal items, as the probate judge would prefer to keep these issues out of the courtroom!

Although you do not need to meet with us immediately, there are some decisions which have to be made immediately.  The questions most often asked are: “How do I get death certificates? and How many death certificates do I need?”  Typically the funeral home will assist you with obtaining death certificates.  It is important to review the form with the submitted death certificate information.  Of particular importance are the spellings of names, and the decedent’s social security number.  For most estates, at least five (5) certified death certificates are needed, and often we recommend that ten (10) be requested.  The exact number will depend on the types of assets the decedent owned and the process which will be used to administer the estate.  Should you find you need more death certificates later, we can assist you with ordering more from the county.

The process to administer a deceased person’s estate will depend on the type of Estate Planning documents the decedent had.  If the decedent had no documents or just a will, the estate will most likely need to pass through Probate.  If the decedent had a living or revocable trust, then a Trust Administration will need to be commenced.  The estate administration process depends not only on the type of documents, but also the type of assets the decedent owned.

At the first meeting, we will request that you bring the originals of all estate planning documents, as well as a certified death certificate. The type of estate planning documents will dictate the process required to administer the estate, as well as the type of assets and the title of those assets.   In order to review the type of estate administration work which will be necessary, we will need copies of all asset statements which cover or are as close to the date of death as possible.  Information relating to life insurance, retirement accounts, annuities and other assets which may have named beneficiaries should also be provided.  Upon review of all of the information, we can then provide you with the guidance necessary to administer the estate efficiently with the least amount of stress for you.