What Assets are Excluded from Probate? | California

Does your entire estate – property, funds and all – automatically go into probate in the State of California? Despite some popular misconceptions, that’s not actually the case. The California probate process does not encompass all of the assets owned by a decedent prior to his or her death. Asset ownership, whether done with long-term estate planning or by happenstance, will determine whether assets are subject to the probate process.

There are various legal forms of ownership within an estate or trust, and these different types of vehicles for securing estate assets help to regulate what will fall under probate and what will stay immune to those proceedings. Let’s take a look at the several exceptions to the California probate rule:

• Joint Tenancy: Assets held in joint tenancy ownership are not subject to probate because the decedent’s joint tenancy property interest ceases at death – essentially there is no asset remaining to probate.
• Living Trust: Assets held in a living trust are not subject to probate. This is sometimes easier said than done because actual title transfers into a living trust may not have been accomplished.
• Retirement Accounts: Assets such as IRAs, 401ks, and other retirement accounts or life insurance policies often have beneficiary designations and are excluded from probate. Financial accounts sometimes have beneficiary designations as well. These assets pass outside of probate if the beneficiary survives the decedent.
• Trustee Accounts: Assets held in a bank or credit union are excluded from probate when the deceased was acting and named as a trustee, guardian or conservator for another person.
• POD Accounts: Assets such as bank accounts registered as “pay on death.” These are often referenced as “POD” accounts. Securities accounts that are registered as “transfer on death” are also excluded from probate. These are often called “TOD” accounts.
• Marriage/Community Property: Assets registered in a married couple’s name as community property with the right of survivorship are excluded from probate, as well.
• Life Estate: Life estate interests of the decedent terminate at death and are not subject to probate.

Now you have a basic rundown of just what estate assets are insulated from the probate process. There are a variety of ways to safeguard your funds and property for your loved ones through strategic estate planning and asset protection, but you need an experienced probate attorney with the skill and professional know-how to make it happen. At Hackard Law protecting clients and their family’s future is our top priority – call us today at 916-313-3030.