Using the California Small Estates Laws to Avoid Probate

Using the California Small Estates Laws to Avoid Probate  

By Attorney Paul Hanks Ironclad Living Trusts in California

In my personal experience as an attorney I have used the California small estates laws to the advantage of many clients with smaller estates.

The California small estates laws are an expression by our legislature that it is not reasonable for all estates to be subject to probate. If an estate is below a certain amount then probate can be avoided even if there is not a trust in place. The amount which rescues an estate from probate has changed over time. For example, the top dollar value for small estates protection was $166,250 in the year 2020, and $184,500 for the year 2024. The legislature has created a form known as a small estates affidavit for this purpose. The procedure is quick, and can be commenced as soon as 40 days have passed since the date of death.

In adding up the assets that count against the small estates limit, it is great to know that some assets are excluded from that calculation. For example, motor vehicles, jointly owned assets, and most assets passing by way of beneficiary designation are excluded.

In years past, real property (such as a home or condo) could not pass by way of the small estates affidavit but rather by use of what is known as a Petition to Determine Succession to Real Property. The problem was that very few estates qualified due to high California housing prices. But now a new law has come to the rescue, and starting as of April 1, 2025 the threshold has risen to $750,000. Court is still necessary but it is less time consuming than a prolonged probate of the estate.

Of course it is still wise to have a living trust in place in order to eliminate court altogether and plan for your incapacity. Trusts have valuable provisions in them for protection against Medicare and Medi-Cal estate recovery, and also powerful clauses regarding conservatorship, and all of which can save an estate tens of thousands of dollars. Having a home in trust will also insulate the home from the sharply rising incidence of loan fraud. Trusts also assure the generational passing of your property and shields an estate from scam artists who prey on the elderly.

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