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Estate Planning

Estate Planning In California

Estate PlanningThe following article will cover:

  • Estate planning, probate, and dying intestate in California.
  • Different types of trusts and their purpose in California, specifically the family revocable trust or ABC trust.
  • Healthcare-related documents that should be included in an estate plan in California, including healthcare directives and do-not-resuscitate orders.

What Is Estate Planning And Why Do We Need It? What Happens When Someone Dies In California Without Having A Proper Estate Planning Document In Place?

Estate planning is the process of organizing your assets and determining how they will be managed and distributed upon your death. If you pass away in California without an estate plan, your estate may be subject to probate, especially if you have significant assets valued over $166,250 (as of 2023) or any real estate. Dying without a will is called “dying intestate,” and in this case, the court will rely on California law to determine the distribution of your estate.

Fortunately, California law typically aligns with most people’s preferences, giving priority to spouses and children, and then distributing assets up the family tree and along branches to find the appropriate heirs.

However, going through probate has its downsides. In some counties, like Monterey County, probate can take up to two years due to backlogged court systems. Additionally, probate can be expensive, as there are mandatory fees based on the value of the assets, which must be paid to the court, attorney, and probate referee.

What Are The Most Common Types Of Trust Used In California And Their Purpose?

To avoid probate, you can establish a trust, a legal arrangement in which your assets are retitled and held by the trust. When you pass away, the trust continues to exist, and the trust document outlines how your assets will be distributed.

The most common type of trust in California is the family revocable trust, sometimes referred to as an ABC trust. This trust typically involves a husband, wife, and children, specifying who gets which assets and who will be in charge of managing the trust after the parents’ death. Family revocable trusts can be customized to suit your specific needs and preferences.

What Healthcare Related Documents Do I Need To Include In My Estate Plan In California?

In California, it is crucial to include a healthcare directive in your estate plan. This document serves several purposes:

  • Appointing an agent to make healthcare decisions on your behalf if you become incapacitated.
  • Outlining your preferences for end-of-life choices, medication, and doctors.
  • Granting post-death authority to handle your remains, including organ donation or body gifts for research.

The format of a healthcare directive is determined by California law and may change over time.

Another essential document is the do-not-resuscitate (DNR) order. Based on personal health situations or choices, some individuals prefer to have a separate document, governed by California law, that explicitly states they should not be resuscitated in case of a medical emergency.

This document is significant legally and should be made known to emergency responders. For example, a person in hospice care can display a sign at their home indicating the presence of a DNR order, so emergency responders are aware of their wishes. For more information on Need For Estate Planning In California, an initial consultation is your next best step.

More Information:

Hudson Martin PC - Carmel, CA

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