If you don’t have an estate plan or have failed to completely fund your Revocable Living Trust, then your loves ones will be faced with probating some or all of your assets. For example, did you know:
• When you die without a properly executed and funded Revocable Living Trust, the cost of transferring everything you have worked hard for to your heirs can cost thousands of dollars and take several years as it goes through a process called probate?
• If you do not properly designate who will inherit everything after your death, the State of California will make that decision for you?
• If you have not made plans, a judge of the Superior Court without any input from you will decide who will raise your minor children?
• Without the proper documents, if you become incompetent, it may cost your family thousands of dollars just to have the right to take care of you and to direct your medical care?
• “Joint Tenancy,” the way in which many married couples hold property, does not avoid probate?
• If you have a Revocable Living Trust prepared prior to 2004, critical documents within your estate plan may not be enforceable?
Please take a few minutes to complete the questions below so you can be properly informed:
• Do you have a Will?
• Does the gross value of your estate (including your house) is over $150,000, do you have a Revocable Living Trust?
• Do you have a Advanced Health Care Directive that provides the names, addresses and telephone numbers of your designated agents?
• Do you have someone authorized to handle financial matters for you in case you become disabled or incapacitated?
• Do you have provisions in your Trust or Will for payment of estate taxes?
If you answered “No” to any of the questions above, your estate is at risk of having to go through probate.
• Do you have an Advanced Health Care Directive that was executed prior to 2003?
• Did you get married recently?
• Have you divorced your spouse?
• Have you purchased or sold a house or other property recently?
• Have you moved between states?
If you answered “Yes” to any of the questions above, your estate is at risk of having to go through probate.
The overall cost of probate will vary depending on the type and value of the property that’s being probated. In general, the greater the value of the probate property, the more probate will cost. The various fees and costs associated with probate are as follows:
These fees are dictated by state law and can range anywhere from a few hundred dollars to over a thousand dollars.
Personal Representative Fees
State law also dictates these fees. Some states simply provide for what is referred to as a “reasonable fee,” while others deem a reasonable fee to be one that’s equal to the value of a certain percentage of the property being probated. A Personal Representative can ask for “extraordinary fees” for services rendered above and beyond services that are deemed to be basic probate services.
These fees are also dictated by state law and are calculated in the same manner as the Personal Representative’s fee. As with the Personal Representative’s fee, an attorney can ask for “extraordinary fees” for services rendered above and beyond services that are deemed to be basic probate services.
These fees will vary depending upon the overall value of the estate and the type of assets owned. If the estate is taxable at the state and/or federal level, then the accounting fees may include the preparation and filing of the state and/or federal estate tax returns if the attorney for the estate doesn’t prepare and file the returns.
Appraisal and Business Valuation Fees
These fees will be necessary to determine the date of death values of real estate, personal property (including jewelry, antiques, art work, boats, cars and the like), and business interests. Appraisal fees for personal property can range anywhere from a few hundred to a few thousand dollars, while business valuation fees will run several thousand dollars.
If you don’t have a Last Will and Testament that waives the posting of a bond by your Personal Representative, then in most cases before your Personal Representative can be appointed he or she will need to pay for and post a bond in an amount determined by the probate judge.
The chart below details the compensation that your Personal Representative and Attorney may request s set by California law relative to the estate’s gross asset value.
|Gross Asset Value of Entire Estate||Estimated Compensation To Attorney And Personal Representative Without Revocable Living Trust And Estate Planning||Probate Fees With A Revocable Living Trust And Estate Planning|
*This not a tax. These are the maximum fees authorized by the California Probate Code, not including special fees. One half will go to the attorney and the other half will go to your Executor or Administrator.
The most effective way to avoid court proceedings concerning:
• Guardianship of assets for minors
Is to create a:
• Revocable Living Trust; and
• Transfer All Assets To Your Trust.
Our team at Estate Planning Made Easy, Inc. can guide you in protecting your assets. Contact us today to schedule your free consultation.