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Forgot to Transfer Assets to Living Trust

What if your parents had a living trust, but one or more of their assets was not titled in the trust when they died. Now what? Will you have to take their estate through probate? You’ve heard about how probate is expensive and time consuming. Is there an alternative?

If the value of the assets not in the trust is less than $150,000, then the estate is considered a “small estate” and may be able to avoid probate. California Probate Code section 13100.

There are three procedures to avoid probate with a small estate, depending on the type of asset and value.

  1. Personal Property Less than $150,000. If the assets not in the trust are all personal property such as bank or investment accounts and valued at less than $150,000, then a Small Estates Affidavit or Declaration can be used. California Probate Code sections 13100-13116.

This is a simple procedure. You will need to prepare the declaration or affidavit and list the accounts that were not in the trust. You will have to wait 40 days after date of death to sign it.

  1. Real Property Less than $50,000. If the asset not in the trust is real property and the gross value of the property is less than $50,000, an Affidavit re Real Property of Small Value can be used. California Probate Code sections 13200-13210. Because of the $50,000 gross value limit, this procedure is typically used for a mobile home lot, a small tenancy in common interest or a rural undeveloped lot.

The Affidavit procedure is straight forward. You need to get an Inventory and Appraisal completed by a probate referee. A probate referee is an appraiser who has been approved by the California Probate Court. After the probate referee appraises the property, you will need to attach the Inventory and Appraisal to the Affidavit and record the documents with the local county recorder.

  1. Real Property More than $50,000 but less than $150,000. If the gross value of the real property not in the trust is more than $50,000 but less than $150,000, then you will have to use a summary proceeding with the probate court. This is much less complicated than probate, but it does require filing a petition with the probate court.

Of course the key to avoiding these procedures is to have the assets transferred to the living trust before death.

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