Law Offices of Chris Arvin

 Estate Planning & Trust / Probate Administration Made Reasonable & Accessible

Living Trusts

A living trust is set up during your lifetime. It is usually a revocable trust in which you transfer some or all of your property to the trust for the benefit of your beneficiaries. The trust then owns the assets and property. Usually you name yourself as the initial trustee. You can then do what you want with your assets, transferring them out or adding in new ones. It's a convenient way to gather and keep track of all your assets under one document and allows for the rapid and appropriate distribution of those assets to your beneficiaries after you die.

Assets in a living trust are exempt from probate proceedings, which may save your beneficiaries time and money. Another benefit is that a living trust can set up how your affairs are handled if you become incapacitated. Whomever you appoint as your successor trustee can then step in and administer your trust according to your instructions. Also a living trust is a private document whereas a will is not. Living trusts can hold assets for young beneficiaries or special needs beneficiaries as well.
Gaining accurate information that applies to your unique situation is one of the best ways to approach a living trust. If you live in or are looking for an attorney in the Los Angeles area to help you with a matter related to this topic, you have come to the right place. Our law firm may be able to provide you with the legal support you need. With a complete understanding not just of living trusts but of other options that may be available to you, we can give you a clear picture of what to expect. We can help you make choices that will benefit you now and in the long term.


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What is probate administration?

When a person dies, his or her estate must be properly cataloged and distributed amongst heirs and beneficiaries. In some cases, this will require filing an application for probate. Probate administration is a term that refers to the process of appointing an executor or administrator who is responsible for several key issues in regard to the decedent's estate. This may include:

  • Identifying and accounting for all assets;
  • Identifying and paying all debts that are owed by the decedent;
  • Identifying and paying all tax debt, including income and death taxes;
  • Preparing a final accounting of this to the probate court; and
  • Distributing the estate assets in a fair and proper manner.


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Is probate necessary?

Probate is not always necessary, and there are actually some steps you can take in order to avoid probate entirely. In addition to discussing the matter with a probate lawyer at our Los Angeles law firm, you are welcome to review the information on this page regarding several key issues in avoiding probate:

  • Small estates are typically not probated. According to California Probate Code, estates valued at less than $100,000 are not subjected to probate. This may even apply when the total value of the estate is more than $100,000 - if some or all of the assets are not considered probate assets. This may include life insurance (if beneficiary is named), joint tenancy assets, assets in a living trust, retirement plans, 401(k)s and IRAs.
  • In the event that a decedent is survived by a spouse, the spouse may be able to file a spousal property petition with the court. This petition is filed to change ownership of assets into the surviving spouse's name. It is essentially a simplified form of probate and is completed in far less time and usually involves lower legal fees.
  • Assets owned through a living trust will be exempt from probate.Assets owned by two or more persons, through joint tenancy, typically are not probated.


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Power of Attorneys

What Does a Power of Attorney Do?
A Power of Attorney allows you to appoint another to act for you when you are unable to do so. This person then becomes your "Agent" or "Attorney-in-Fact." He or she may be authorized to do very simple tasks such as writing checks for you, or transfer an asset to your Trust, or very complex jobs such as selling your house or running your business. The Power of Attorney can also be of very general nature, giving your Agent the authority to do everything you would normally do or it can be for one specific purpose or task only, such as selling a property or vehicle.  

You can name anyone to be your Agent in the Power of Attorney. Most often, it's a trusted family member or friend (sometimes same person who is your Successor Trustee).  

Types of Power of Attorneys
There are four types of Power of Attorneys. Your choice will depend on how much authority to want to grant your agent, when he or she will begin acting for you, and when you want that authority terminated.

The four types are called:

  • Limited Power of Attorney -- for a limited time period
  • General Power of Attorney -- allows someone to take over generally
  • Durable Power of Attorney -- begins after you become incapacitated
  • Springing Power of Attorney -- effective if you become incapacitated and defining what events constitute the state of incapacitation


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Trust Administration

After the death of the Trustor, who is the person who created a trust, certain steps must be taken to administer a trust. We can help you through the difficult time after the death of a family member. With their skill and comprehensive understanding of all facets and make this a successful and smoothly run process.

The Steps Involved
Title or ownership of assets will be determined as well as their monetary values at the time of their owner's death. Proper valuation of estate assets is important because of income tax and estate tax consequences. Experts in property and asset valuation are required for this essential task. Such assets include not only real estate but also stock portfolios, other securities and investments, vehicles, jewelry, art, collectibles, mobile homes, and other personal belongings.

There is a need to determine which assets are in the trust and which are not, and what the estate taxes may be. 

Requirements: accounting, pay any bills due, file any tax forms needed and then distribute the assets due to the beneficiaries per the terms of the trust document.

Division of assets for multiple beneficiaries.  Deeds are prepared by Counsel.

We provide suggestions for assets that need rehabilitation before a sale or leasing as needed.

Critical property tax applications are needed in a timely manner to avoid re-assessment when there are transfers of real estate between parents/children/grandparents - we assist you prepare the needed filings and applications.

The Importance of Trust Administration
Depending on the size and extent of the estate, the duties of a trust administrator may be very complicated, requiring someone who thoroughly understands all the steps and consequences involved. It may also be a very serious business for the administrator has a fiduciary responsibility and may be personally liable if he fails to perform his duties properly. Having one of our Los Angeles trust administration attorneys for this important job can relieve you and your family of undue stress and worry.


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California Probate Laws

State laws concerning probate are extensive and have the potential to be highly complex. We have included some key points on this page, but the best course of action in these matters is to involve an attorney who can guide you through the entire process while protecting your rights and financial interests.  

  • Probate begins with the filing of a petition for probate at the Superior Court where the decedent lived. This petition will typically be filed by the attorney of the individual who wishes to become the administrator or executor. It should include information about the decedent, the executor, heirs and the size of the estate.
  • The judge who hears the case will make a decision as to whether the petition will be approved.
  • California law requires that notices be sent to all heirs, beneficiaries and proposed executors, with a date and time of the hearing and at which courthouse the case will be heard.
  • Estates valued at more than $100,000 will typically need to be probated, though there may be some exceptions to this rule.
  • Assets that are held only in the name of the decedent are typically considered probate assets.
  • In the event that there is a surviving spouse, formal probate may be avoided with a spousal property petition.
  • Probate typically takes approximately 9 months, although this may vary depending on the case.

California Probate Code outlines specific fees for attorneys and executors that can only be exceeded in particular circumstances with court approval. As an example, the maximum fee for an estate valued at $100,000 is $4,000.


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Probate

What is probate?
Probate is the legal process or court procedure that occurs after someone dies. It usually involves proving that the deceased person's will is valid, identifying his or her probate estate property, having it appraised, paying whatever debts or taxes are outstanding, and distributing the remaining assets or property according to the deceased person's will or state law.

Under probate estate administration, an executor or administrator is appointed by the court to be responsible for the estate. If the deceased person failed to name an executor in his will or that executor is no longer able to act as his agent, then the court will appoint someone else.

What makes up probate estate assets? 
​All types of property make up the probate estate, including real estate and personal belongings, such as jewelry, stocks, cars, art and collectibles. Real estate, however, must be probated in the state where it's located, so if your relative lived in Los Angeles and owned a house in New York, the New York house would not be part of the probate estate here.

Non-probate assets are those that pass automatically to a beneficiary, such as named beneficiaries in a life insurance policy.   A life insurance policy or retirement plan without a named beneficiary may be payable to the Probate (typically not desired result).


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Advance Health Care Directives

What Do Advanced Health Care Directive Do?
California law provides you with the ability to make your health care wishes known and considered if you are not able to make those decisions yourself. This is done through a document called the "Advanced Health Care Directive." By completing an Advanced Health Care Directive, California law permits you to appoint someone to be your health care "agent." Your agent is legally authorized to make decisions about your health care if you are unable to do so. In the Advanced Health Care Directive form, you may also put in writing your specific health care wishes. For instance, you may object to life-extending treatments or interventions for terminal illness, comas, or other situations. You may not wish to prolong the dying process. You can make such things known through the Advanced Health Care Directive. Your agent and your doctor must then follow your wishes. It is not mandatory that you appoint an agent through the Advanced Health Care Directive but the California Medical Association recommends that you do. At such a critical time, having someone you trust to actively participate in decisions about your health care instead of strangers can only be beneficial and reassuring to both you and your family.


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Wills

Why is Having a Will so Important? 
Most everyone knows the importance of having a will. And if they don't, they should. A will is a legal declaration about how you want your assets, property, personal belongings, money, and valuables distributed after your death. Having a comprehensive and detailed will ensures that your estate is transferred to the beneficiaries you name according to your intentions and wishes.

Planning puts stability and control into the future. In something as important as your estate, having a will in place is essential.

It is important to consider who you want to name as your Executor.  In your Will you should also designate the “Guardian of the Person” of your child/ren (physical Custody), and “Guardian of the Estate” (management of assets belonging to minor children).

What is a Pour Over Will? 
Some people intentionally or inadvertently leave certain property, valuables, or possessions out of their trust. These properties could be things like vehicles, a rare book, jewelry, a work of art, or other personal belongings. The reasons for leaving them out of the trust could be simple forgetfulness, or the fact that they were acquired after the trust was written, or they were left out for tax reasons or other considerations.

Thus the pour over will is used in conjunction with a trust. It means that any asset not put into the trust during the person's life is caught and "pours over", or goes into the trust when he or she dies. These assets then eventually become distributed as part of the deceased person's estate according to his instructions instead of under state law.


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Practice Areas

Why a Living Trust?

Why should you consider establishing a living trust? This is a question that must be answered for yourself, taking your personal goals into account while weighing the potential advantages and disadvantages associated with a living trust. We draft very specific Trusts tailored to your specific needs and situation, and family members.
There are specific advantages associated with living trusts. Depending on the particular trust you establish, you may be able to avoid probate, reduce estate taxes and set up long-term property management. The primary advantage of a living trust is the fact that property left through the trust will not have to go through probate court. Probate may not only drag on for months, but when it finally concludes and inheritors receive what you have left to them, there may be less. Attorney and court fees may reduce assets by approximately 5%.

A living trust is set up while you are still alive. All property transferred into a living trust will not go through the probate process. Instead, the trustee (the person you have appointed to handle the trust) will transfer ownership to the beneficiaries you have already named. This usually only takes a few weeks and attorney and court fees do not have to be paid. Once the property is transferred, the living trust will no longer exist.

It is critical to draft a very specific trust specifying beneficiaries.  Without a Trust (or Will) the state/statutes name beneficiaries – which may not be your preference (for example only, you may prefer certain family members to receive higher or no percentages, you may prefer to defer distributions to a beneficiaries  who are too young or immature, you may prefer to leave property to a life partner who you are not married to or who is not your registered domestic partner and would therefore receive no inheritance by state law if you do not have a specific Will or Trust).


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Miscellaneous Probate Question/Answer

What is probate?
Probate is a process that involves ensuring the validity of a decedent's will, cataloging assets and property, paying outstanding debts and distributing property per the decedent's will or state law.

If I have a small estate, is probate necessary?
In California, estates valued at less than $100,000 are typically not probated. If the estate includes real property valued at more than $30,000, however, it will typically need to be probated. It is often helpful to determine if probate is necessary or if you can avoid probate by talking to an attorney about your particular case.

Do I need a lawyer?
Because probate is a legal process that has the potential to be complex and difficult to deal with, it is helpful to involve a lawyer who can protect your legal rights and guide you through as swiftly as possible.  

How long does probate in Los Angeles usually take?
If there are no issues or problems, probate may take about 9 months. Process can take longer depending upon the case, and the Court’s work-load.

Who will receive a notice that probate proceedings have begun?
California probate law requires that all heirs of the decedent, beneficiaries mentioned in a will and proposed executors be informed that probate is being started, with a date, time and location of the hearing where the case will be heard.

How much does probate cost?
There are particular fees set forth by state law regarding attorney and executor fees for probate (higher fees may be awarded in particularly complex cases, as ordered by the court). The maximum fees allowed are 4% of the first $100,000 of the estate, 3% of the next $100,000, 2% of the next $800,000, 1% of the next $9,000,000 and .5% for the next $15,000,000. The court will determine the fee for any amounts greater than $25,000,000.


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