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In California, the role of a conservator is to manage the personal and financial affairs of an incapacitated person, known as the conservatee. However, a common question arises: Can a conservator draft a will or a trust for an incapacitated person? The straightforward answer is no.
Understanding the Role of a Conservator A conservator is appointed by the court to ensure that the conservatee’s needs are met, which includes managing their finances, healthcare decisions, and daily living arrangements. While a conservator has significant responsibilities, they do not have the legal authority to create or change estate planning documents, such as wills or trusts, on behalf of the conservatee. The Importance of Legal Capacity Creating a will or trust requires the individual to have legal capacity. This means they must understand the nature and consequences of the document they are signing. If a person is deemed incapacitated, they lack this capacity, which is why a conservator cannot unilaterally draft these important documents. Seeking Court Approval In certain situations, a conservator may need to take action regarding estate planning for the conservatee. In such cases, the conservator can file a substituted judgment petition with the court. This petition allows the conservator to seek the court's permission to make specific estate planning decisions, such as modifying an existing trust or creating a new one. The court will carefully evaluate whether the proposed action is in the conservatee's best interests and if it aligns with what the conservatee would have wanted if they had the capacity. Conclusion To summarize, a conservator in California cannot independently draft a will or trust for an incapacitated person. Any significant changes to estate planning must go through a court process, ensuring that the rights and interests of the conservatee are protected. If you find yourself in a situation where you need to make estate planning decisions for someone under conservatorship, it's crucial to consult with an experienced attorney who can guide you through the legal requirements and processes involved. If you have further questions about conservatorships or estate planning, feel free to reach out for assistance! When an executor incurs expenses in administering an estate, one common question is whether they need to file a creditor’s claim to be reimbursed. The short answer is: No, an executor does not need to file a creditor’s claim for reimbursement of expenses related to estate administration. Here's why:
Executor’s Expenses vs. Creditor ClaimsAn executor’s expenses, such as court fees, attorney fees, or costs related to property maintenance, are considered administrative expenses. These are not debts owed by the decedent before death (like medical bills or personal loans) but rather costs incurred after the decedent’s death in managing and settling the estate. As such, they are handled differently in the probate process. How Reimbursement Works
A pour-over will alone is typically not enough to file a Heggstad petition. A Heggstad petition is used in California to confirm that an asset not included in a trust should be considered part of that trust. To support such a petition, you usually need more than just a pour-over will.
A pour-over will is a legal document that works in conjunction with a trust. It directs that any assets not already in the trust at the time of the person's death should "pour over" into the trust. However, for a Heggstad petition, there must be evidence that the asset was intended to be in the trust at the time of the person's passing. To file a successful Heggstad petition, you may need additional evidence such as: 1. **Documentation:** Any documents or statements showing the deceased person's intent to include the asset in the trust. 2. **Trust Language:** If the trust language clearly identifies the asset or indicates an intent to include similar assets, it can support the petition. 3. **Communication:** Any written or recorded communications where the person discussed or expressed their intent to include the asset in the trust. 4. **Witness Testimony:** Testimony from witnesses who can attest to the deceased person's intent regarding the asset and the trust. 5. **Previous Transfers:** Any previous transfers or actions that demonstrate an intent to include the asset in the trust. Consulting with an estate planning attorney or a legal professional familiar with California probate and trust laws would be beneficial if you are considering filing a Heggstad petition or dealing with trust-related matters. They can review the specifics of your situation and guide you on the necessary steps and evidence required for such a petition. Ancillary probate in California refers to the legal process that occurs when someone who owned property or assets in the state passes away but was not a California resident. It is a supplemental probate proceeding that runs parallel to the primary probate process in the deceased person's state of residence.
Here’s a breakdown of what ancillary probate involves in California: What Triggers Ancillary Probate? Ancillary probate becomes necessary when a non-resident of California, known as the decedent, owns property or assets within the state's jurisdiction. These properties could include real estate, bank accounts, vehicles, or any other tangible or intangible assets. Key Features of Ancillary Probate in California: 1. Court Jurisdiction: The ancillary probate process takes place in the county where the property or asset is located. For instance, if the decedent owned a property in Los Angeles County, the ancillary probate would occur in the Los Angeles County probate court. 2. Executor/Administrator Appointment: Similar to primary probate, the court appoints an executor (if there's a will) or an administrator (if there's no will) to manage the estate during the ancillary probate process. 3. Notification: Beneficiaries and heirs must be notified of the ancillary probate proceedings, just like in the primary probate process. This ensures transparency and gives interested parties an opportunity to participate. 4. Asset Inventory and Valuation: The executor or administrator is responsible for identifying, inventorying, and valuing the assets located in California. This includes conducting appraisals, gathering financial records, and assessing the overall value of the estate. 5. Creditor Claims: As in primary probate, creditors have a chance to file claims against the estate during ancillary probate. The executor or administrator must address these claims according to California probate laws. 6. Distribution of Assets: Once all debts, taxes, and expenses are settled, the remaining assets are distributed to the beneficiaries according to the decedent's will or California's intestate succession laws if there's no will. Why Ancillary Probate Matters: - Legal Compliance: Ancillary probate ensures that out-of-state assets are properly accounted for and distributed according to California laws. - Asset Protection: It helps protect the rights of beneficiaries and ensures that assets are not mishandled or misappropriated. - Tax Considerations: Ancillary probate also addresses tax liabilities associated with California-based assets, such as property taxes or inheritance taxes. Challenges and Considerations: - **Complexity:** Managing probate across multiple jurisdictions can be complex and time-consuming, requiring coordination between legal professionals in different states. - **Cost:** Ancillary probate adds to the overall probate costs, including legal fees, court fees, appraisal expenses, and other administrative costs. - **Potential Delays:** Depending on the complexity of the estate and the cooperation of involved parties, ancillary probate proceedings can prolong the settlement process. In essence, ancillary probate in California serves as a vital legal mechanism to ensure that non-resident decedents' assets within the state are handled appropriately and in compliance with state laws. While it adds an extra layer of complexity to the probate process, it plays a crucial role in protecting the interests of beneficiaries and facilitating the orderly transfer of assets. As always, having an experienced attorney handle these matters for you is advised, since the process of ancillary probate can be daunting and time consuming. It is difficult to acknowledge the reality, but our loved ones do sometimes get sick, get into accidents, have unexpected medical issues, get injured, lose mental capacity, or even go missing. In legal words, there is a general term for this, called the "incapacity." While individual is present and has "capacity" they should execute a Power of Attorney and a Advance Healthcare Directive nominating the desired individuals to make financial and healthcare decisions for them during their potential incapacity. If they forget or avoid executing these documents, their spouse, children, or family members might have no other choice but to file a petition through the Court to establish a Conservatorship over the individual. This is why these documents are always included in our Estate Planning Packages, they avoid the need down the line having to go through costly and lengthy Court procedures, as explained below.
A conservatorship in California is a legal arrangement where a court appoints a responsible person or organization (the conservator) to manage the personal and/or financial affairs of another individual (the conservatee) who is unable to do so themselves due to physical or mental limitations. Conservatorships are typically established to protect the interests of individuals who are unable to make decisions or care for themselves due to conditions such as dementia, developmental disabilities, mental illness, or other incapacitating factors. There are two main types of conservatorships in California:
It's important to note that conservatorships are intended to be a last resort when there are no less restrictive alternatives available to meet the needs of the conservatee. Additionally, they can be temporary or permanent, depending on the individual's circumstances and the court's findings. Conservatorships have gained significant public attention and scrutiny in recent years, particularly in high-profile cases. In 2021, California passed legislation aimed at increasing transparency and accountability in conservatorship proceedings, particularly in cases involving adults under conservatorship. Legal requirements and procedures may evolve over time, so it's advisable to consult with an attorney or legal expert for the most up-to-date information on conservatorships in California. Probate is the legal process through which a deceased person's assets are distributed and their debts are settled under court supervision. While probate serves an important purpose in ensuring the proper distribution of assets and protection of creditors' rights, there are several reasons why it is often considered unfavorable by many:
Introduction
In November 2020, Californians voted on Proposition 19, a ballot initiative that aimed to make significant changes to the state's property tax and inheritance laws. Proposition 19 marked a pivotal moment in California's legal landscape, sparking debates and discussions about property taxation, intergenerational transfers, and the overall impact on homeowners and the state's revenue. This article delves into the key provisions of Proposition 19 and explores how it has changed the law in California. Background: Proposition 13 and Proposition 58 To understand the significance of Proposition 19, it's crucial to first grasp the context provided by previous propositions. Proposition 13, passed in 1978, significantly limited property tax increases by capping the rate at 1% of a property's assessed value. Furthermore, it restricted reassessment to occur only when a property was sold, ensuring that long-time homeowners enjoyed relatively stable property taxes. Proposition 58, approved in 1986, allowed parents to transfer primary residences and up to $1 million in assessed value of other real property to their children without triggering a reassessment. This played a vital role in allowing families to pass down homes without imposing potentially burdensome tax hikes on the next generation. Proposition 19: A Shift in Property Tax Rules Proposition 19 brought forth substantial changes to these existing property tax regulations. Its main provisions include:
Whether or not grandchildren inherit from their grandparents if their parent predeceases the grandparent depends on whether the grandparent passed away with a Will or without.
In general, if a grandparent dies and their will specifies that their assets should pass to their children, but one of their children has already passed away, then that deceased child's share of the inheritance would typically pass to their own children (the deceased child's children), i.e., the grandchildren of the deceased grandparent. This is known as the "right of representation" or "per stirpes" inheritance. A will might also pass the deceased child's share to the other children, providing nothing for the grandchildren of the deceased parent. However, if the grandparent died without a will, the inheritance would generally be distributed according to the California intestacy laws, or the laws of the state where the grandparent lived. In California, grandchildren may inherit from their grandparents pursuant to California's intestacy laws, if their parent has pre-deceased the grandparent, in a "per stirpes" inheritance. This is guided by California Code, Probate Code - PROB § 6402 and CA Prob Code § 240. It's important to note that the laws surrounding inheritance can be complex and vary depending on the specific circumstances involved. It's always a good idea to consult with an estate planning attorney to ensure that you understand your rights and obligations under the relevant laws. I get this question a lot. This is a very complicated and sensitive subject that I attempt to address on a case by case basis. The answer is always yes!
First, you are definitely worth something to someone on a simply emotional level. While in our daily lives we sometimes lack the personal connection and recognition to retain a concept of self-worth, this is only a reflection of the business of the day to day lives of yourself and those around you. Do not use this as a measuring stick of your own self worth or your own value to people around you. Your own perception of yourself is undervalued and underappreciated. With that said, when it comes to incapacity and death, I have not yet had a case where someone somewhere was not reminisced or positively mentioned at either their hospital bed or their funeral. The opposite is usually the truth. As to your "worth", just as above, your items, memorabilia, collections, photographs, heirlooms, clothing, tools, furniture, art, books, musical instruments, technology, are all worth something to someone. I have seen family members argue more over a very specific worthless item, than a $5,000 bank account balance. Certainly some items are literally worthless to someone, but are priceless to others. Keep in mind that sometimes these are items that people may "expect" to inherit, but you may not want them to. Do I need an estate plan? Yes. Your wishes must be reflected on estate planning documents in order to guide those that you love after your passing and give them clear instructions as to what you would have wanted to happen. Generally a living trust is not a tool for debt avoidance or asset protection. While the living trust assets are technically in the name of the living trust, rather than your own, this does not prohibit creditors from seeking trust assets to pay for debts owed to them, and are in fact discoverable assets, meaning someone may request an accounting of the trust assets.
However, beneficiaries who have not yet received the trust assets may not be named under liens or creditors lawsuits, since they have not yet received the asset itself. Finally, while trusts are private documents not filed with the county or any other public agency, trust assets are discoverable and may be examined through a subpoena for records or through a court order. By placing assets into a living trust you are protecting the assets from waste, mishandling, and conflicts, by setting clear instructions on how assets are to be distributed. You are also attempting to avoid probate proceedings, which are costly, public, lengthy, and contested. However, placing assets into a living trust, does not "hide" them from creditors and should not be used for such purposes. Power of Attorney takes effect during the incapacity of the person, and effectively ends if the person passes away. Power of Attorney is granted over all or some of the assets of the individual, unless those assets are in a Trust, in which case only the Trustee may make decisions.
A Living Trust on the other hand is amendable and revocable during the lifetime of the Trustor, however, it becomes non-amendable and irrevocable only when the Trustor passes away. If you are incapacitated or hospitalized, the nominated Trustee may continue to manage only those assets that are actually part of the Trust. Both documents are extremely important and nominees holding the power of attorney should not be different than trustees of a living trust to avoid any issues and conflicts. In short, the trustee of a Living Trust may administer only Trust assets during incapacity and after death. The power of attorney nominee may only administer assets during the incapacity of the person, authority over which ends in death. If you have been appointed as a co-trustee of someone's trust, you are placed in a fiduciary relationship to the Trust, which includes the responsibility to cooperate with the other appointed co-trustee.
You should review your trust documents to see whether co-trustees must make all decisions together or whether they have leeway to make certain decisions on their own. Usually for matters that require signing or opening or closing of accounts, both co-trustees must agree but a single trustee is permitted to act. If both are required to make the decisions or if you hit a roadblock that requires both trustees consent, what do you do if the other co-trustee is not cooperating? First, you should remind the non cooperating party that even though this is a tough undertaking, the person nominating you both as co-trustees wished you to cooperate together. This is also important as you are respecting their wishes. Additionally, there is usually a provision for "reasonable fee" or something of the sort permitting the trustee to charge the trust for reasonable time and expenses in having to cooperate with you. Some financial incentive may change their perception of their responsibilities. Second, if the above doesn't work, you should remind them that they may be in breach of their fiduciary obligations to the trust. This breach is significant since one may be liable for breaching their fiduciary duties to the trust. Third, you may send them a demand letter, to cooperate and to notify them that you may have to take legal action, on behalf of the trust, to seek to remove them if they are in breach of their duties. Finally, you may have to file for arbitration or file a lawsuit to remove the trustee from the trust. This is a complicated process and may be avoided if the trustee resigns altogether and relinquishes their duties or has a change of mind. For more questions, please ask our attorneys at: www.forwardestateplanning.com/ Clients often reach out to create a power of attorney, a will, or a trust for themselves and their spouse. Sometimes this happens because they notice that their spouse’s mental coherence or ability to understand something may be deteriorating and they want to make sure that they have all the documents in place in order to avoid complications on continuing to provide care for their spouse or family member.
This bring to question whether someone can actually sign the power of attorney, will, or trust documents. More specifically, do they have the mental capacity to sign such documents and as such whether these documents will be valid if there is a challenge to them. An A/B Trust is a type of Living Trust that is set up jointly by a married couple in order to (a) minimize taxes on either of the trusts and (b) lock the ability of one of the spouses to make changes at least as to the decedent’s amount of the trust.
AB Trust operates by automatically creating two trusts at the death of one of the spouses, Trust A (Surviving spouse half) and Trust B (Decedent’s spouse half). If a loved one passed away and you are aware or were told that they created a trust and named you as a trustee or a beneficiary, you will need to find the original or a copy of the validly executed trust documents, which can sometimes prove challenging if the trustor did not take steps to notify the appropriate people.
Problems arise when the originals can’t be found, or the originals are incomplete. Furthermore, people might rely on incomplete documents if they are not careful to make sure that they are valid and most importantly reflect the intent of the original trust creator. So what do I do? If a loved one recently passed away and in their estate planning documents they nominated you as a Trustee of their Trust, you have now been handed the proverbial keys to the kingdom of that person, in order to administer their estate per the decedent’s, the person that passed away, wishes. This can be seen as an honor, a burden, and certainly a responsibility. So, what do you do now? Below are just the basic steps that trustees usually have to take to administer their duty responsibly. Seek help from a professional attorney for any of the below steps to avoid severe complications down the line.
1. ACCEPT OR DECLINE. You should know is that as a Trustee you have certain duties and obligations to the Trust and if you are not willing or able to do these duties you are permitted to decline being the Trustee and nominate a substitute trustee to take over this responsibility. However, Trust administration is also not a mystical magic procedure, plus you can hire specialists using Trust funds to help you administer Trust assets. The benefit of a living trust is that it's terms, conditions, and beneficiaries may be changed during the testator's lifetime. With that said some changes may only need an amendment, however in other aspects a restatement may be necessary.
TRUST AMENDMENT Amendments to trust are reserved for only minor changes to the trust provisions. For example is there is a name update, change of a specific gift, contact information, or other changes that don't materially change the terms or the distribution provisions of the trust. TRUST RESTATEMENT Restatement is a more formal procedure of completely restating the terms of the trust, while keeping the trust name intact. Restatement is used when major provisions of the trust need to be changes. Number and type of beneficiaries, addition or removal of trustees, change in the goals of the trust, or updating of the trust terms for the purpose of compliance with a new laws or regulations. Furthermore, if there are changes that are relatively minor but propagate throughout the trust, a restatement is a much wiser step, because it avoids the possibility of amending one part of the trust, but forgetting to amend the second part. Finally, some financial institutions and county recording offices require that trusts be restated through an attorney to formally accept the changes in the paperwork and to minimize errors and liabilities down the line. If you have any further questions about this topic, please visit us at: www.aristovlaw.com/ Inheritance is simply succession to tangible and intangible things. While it can mean many things to inherit something that we have no control over, like gene traits, values, and personality, in a more tangible way inheritance means your succession to someone’s assets, properties, and accounts.
Estate planning is a conversation with an attorney about inheritance of the tangible things. Estate planning is a complex and sensitive conversation and as attorneys we see that many people do not reach out for help when they need it most. So how do I get started with estate planning Probate means that there is a court case that deals with:
California law provides a statutory fee for the administrator of an estate. The Public Administrator is allowed the same compensation as private administrators. The allowable fees are based on the value of the estate are as follows:
Contact our attorneys to make an appointment if you have further questions.
No. A deed of reconveyance is only to officially document the fact that you paid off your loan. This is not a transaction that would cause a change in ownership simply because there is no transfer of beneficial use.
To speak to an attorney, please visit us at: www.aristovlaw.com/ One of the primary purposes of placing a property into a Trust and to have a complete Estate Planning package is to avoid re-assessment of the property upon transfer to those that are inheriting the property.
If a transfer of real property results in the transfer of the present interest and beneficial use of the property, the value of which is substantially equal to the value of the fee interest, then such transfer would constitute a change in ownership unless a statutory exclusion applies. An exclusion occurs when the assessor does not reassess a property because the property or portions of the property are automatically excluded from reassessment or is eligible to be excluded if the owner properly files a claim. The following abridged list covers most changes in ownership that are excluded from reassessment, either automatically or by claim. Changes in ownership that require a claim to be filed to avoid reassessment include the following:
Changes in ownership that are automatically excluded from reassessment include the following:
Please see the California Board of Equalization for more information: https://www.boe.ca.gov/proptaxes/faqs/changeinownership.htm Contact our attorneys to make an appointment if you have further questions. Each county assessor's office reviews all recorded deeds for that county to determine which properties require reappraisal under the law. The county assessors may also discover changes in ownership through other means, such as taxpayer self-reporting, field inspections, review of building permits and newspapers. Once the county assessor has determined that a change in ownership has occurred, Proposition 13 requires the county assessor to reassess the property to its current fair market value as of the date ownership changed.
Since property taxes are based on the assessed value of a property at the time of acquisition, a current market value that is higher than the previously assessed Proposition 13 adjusted base year value will increase the property taxes. Conversely, if the current market value is lower than the previously assessed Proposition 13 adjusted base year value, then the property taxes on that property will decrease. Only that portion of the property that changes ownership, however, is subject to reappraisal. For example, if 50 percent of the property is transferred, the assessor will reassess only 50 percent of the property at its current fair market value as of the date of the transfer, and deduct 50 percent from any existing Proposition 13 base year value. In most cases, when a person buys a residence, the entire property undergoes a change in ownership and 100 percent of the property is reassessed to its current market value. Contact our attorneys to make an appointment if you have further questions.  WHAT IS A SMALL ESTATE AFFIDAVIT?
If the estate consists solely of personal property (for example a bank account) and the gross value is under $166,250, you could complete an Affidavit (or Declaration) for Collection or Transfer of Personal Property under Probate Code §13100. This is a form that one can print out and fill out themselves. This is not a court procedure. It must be at least 40 days since the date of death. This cannot be used to transfer real property (land or buildings). All persons entitled to receive assets must sign the affidavit and the signatures must be notarized. This form can then be presented to banks, lenders, social media companies, etc., in order to prove your ownership of the asset or account. WHO CAN APPLY FOR SMALL ESTATE AFFIDAVIT? There are quite a few successors that can file for a small estate affidavit, but they must be somehow related to the decedent in order to claim a particular item. Specifically, for example a close friend, roommate, or a fiancée cannot apply for a small estate affidavit as they don't have standing under the statute. 13101 permits a “successor of the decedent (as defined in Section 13006 of the California Probate Code) to the decedent’s interest in the described property” to file the small estate affidavit or someone permitted to file on behalf of a decedent under 13051. 13006 states that either persons under a will or trust or any successors as defined by sections 6401 or 6402 can apply. 6401 defines provisions of decedent’s share if decedent had a surviving spouse and 6402 defines the whole lineage which to follow to determine if there is a successor, which includes children, parents, grandparents, uncles, children of pre-deceased spouse, next of kin, parents of a pre-deceased spouse. AFFIDAVIT RE REAL PROPERTY OF SMALL VALUE If the estate consists of real property worth $20,000 or less, you can complete an Affidavit re Real Property of Small Value. This typically applies to non-developed land-ownership as the value cap is very low. The affidavit may be filed six months after death in the county of residence. If the decedent was a non-resident of California, the affidavit may be filed in the county where the property is located. This is filed with the court; however, there is no hearing set. Contact our attorneys to make an appointment if you have further questions.  1. Do I have anything written down anywhere that outlines WHO will take care of my kids in case something happens to me?
I have clients that have nothing written down anywhere, and they are just “hoping” and relying on the good spirits of their relatives or friends that someone will step in. While we rely on informal associations, this is not how authorities work. They need documentation to prove that you are the proper guardian and are often prohibited from doing anything until this paperwork is produced. I also have clients that have something written down “somewhere” but turns out its not signed or notarized. The legal effect of this paper is the same as not having anything at all.  Estate planning clients are often surprised to find that the title to the property that they thought they own, is actually a joint title, or some other form of ownership with another person. What does this mean and how does that impact your control over this property?
Title refers to a document that lists the legal owner of a piece of real property, which includes the land, the construction on it, and the rights to use it. When transferred title must be cleared. Clearing a title for real property means determining that it is free of liens or encumbrances that could pose a threat to its ownership. The most common types of real estate title are sole ownership, joint tenancy, tenancy in common, and community property. |
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