PROBATE & TRUST ADMINISTRATION

COURT SUPERVISED VS. BENEFICIARY SUPERVISED DISTRIBUTION OF PROPERTY

Law Books — Estate Planning in Sacramento, CA
The biggest difference between a will and trust is how your assets are distributed. For a will, the distribution process is called probate, which is court supervised. For a trust, the distribution process is called trust administration, which is not court supervised.

Probate

Probate is the process of administering a person's estate after their death. Even though a person has been named in a Will as the Executor, they have no formal authority until the court appoints them as the Executor. This involves filing a Petition for Probate which requests that the court appoint a personal representative to act on behalf of the estate. The personal representative (known as the Executor or Administrator) is responsible to perform the work of estate administration. 

At the time of the hearing on the Petition for Probate the court will appoint the personal representative and issue Letters of Administration or Letters Testamentary. This document is the evidence of the Personal Representative’s authority to act on behalf of the estate.

Trust Administration

Unlike probate, trust administration is not court supervised. A person named in your trust acts as an executor and distributes your assets as stated in your trust. Since a judge is not supervising the distribution, it is up to the beneficiaries named in the trust to supervise the trustee's actions. And like probate, there are certain requirements and things to do, just not as specific and detailed.

Probate & Trust Administration FAQs

What Needs To Be Done To Administer An Estate In A Probate”

The following actions need to be taken to administer an estate: 
  • Take control of all estate assets
  • Collect and deposit receipts
  • Evaluate and pay or contest creditor's claims
  • Sell any assets which need to be sold
  • File any tax returns and pay any taxes that may be due by the deceased individual or the estate
  • Provide an accounting unless the accounting is waived by the estate beneficiaries

When all the responsibilities of the personal representative have been performed, a petition for distribution of the estate will be filed and upon approval of that petition by the court,the estate can be distributed.

Can I Handle A Probate Myself?

Many of the documents filed with the court for a probate are Judicial Counsel forms which are available from the court and on the internet. Even so, completing the forms and complying with various probate procedures requires some understanding of the process involved and not every legal requirement of the probate process is apparent from the forms. Notice of the petition must be served and published in compliance with the probate code and state and local court rules. If the forms are not prepared properly or the procedures are not followed correctly, you may have to go through several court hearings in order to accomplish what which can usually be done with one hearing. There are also various statutory notices and deadlines for completing various required actions. Failure to handle these matters properly can get you into trouble with the court.

Are There Alternatives To Probate?

There are various simplified procedures that allow for distribution of an estate without a full probate. Whether an estate qualifies to use these procedures depends on the type of property in the estate and its value. Some of these procedures are as follows. 

Petition to Determine Succession to Real Property - This is a petition to obtain a transfer of real estate and other property where its value is under $150,000.00. This procedure requires awaiting period of forty days and a formal appraisal as of the date of death. Even when this procedure is technically available, it may not be appropriate in some cases such as where there are numerous heirs or where some of the heirs are uncooperative. 

Spousal Property Petition - This is a petition by a surviving spouse to obtain transfer of real estate and other property regardless of value. This petition only deals with the property that a surviving spouse is entitled to receive. If there are other heirs or beneficiaries, their portion will need to be transferred using one of the other probate procedures. 

Small Estate Affidavit - This procedure is available to transfer personal property where forty days have passed since the date of death, there is no probate proceeding and the value of all such property, excluding certain property is under $150,000. Please note that the maximum value limit includes ALL such property being collected. It cannot be used to, for example, to collect multiple bank accounts where the total amount being collected exceeds $150,000. Again, there may be practical considerations which make this procedure inappropriate, even if it is technically available.

How Do I Administer An Estate Where A Trust Is Involved?

When someone has set up their estate to be handled by a trust, essentially the same procedures apply as with a Probate. The main differences are as follows. Keep in mind that even though the process is not supervised by a judge, the trustee still has essentially the same duties and responsibilities as a personal representative in a probate. 

  • It is not court supervised and the trustee can begin administering the trust immediately and without court confirmation
  • The fees for an attorney to advise and assist the trustee are not set by statute,are usually less than the fees charged for a probate
  • The administration of a trust can generally be accomplished in less time than a probate.

Summary

It is important to choose the most appropriate and cost and time efficient procedure from the outset. That way you do not have to waste time and money using a procedure that will not produce the desired result or which will be too problematic. 

Although the beneficiaries of an estate are entitled to receive their inheritance, it is not automatic. The process requires that someone take charge of the estate and take the steps necessary in order to actually make the distribution. I have over thirty-two years of experience guiding clients through this process. I prepare nearly all of the paperwork involved and walk my clients through the process step by step. I have found that having the assistance of an attorney from the outset makes the whole process go much smoother and is less stressful for the client. 

This information is provided as a general overview of the process of administering an estate. It is not intended to be used as a self-help guide or as a substitute for legal advice and guidance provided by a licensed attorney experienced in probate. Factors and circumstances unique to a particular estate or the applicable laws of other jurisdictions may require significantly different procedures than as generally described in this summary. Also, changes in the law subsequent to its preparation may affect the information contained in it. 
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