What is the Cost of Probate?
Probate is the legal process that occurs if one dies without a will in place with no living spouse and over $150,000 in assets. When an estate goes into probate it can be stressful for the family as it takes a long time and involves numerous fees that prove costly, including attorney fees. This cost is much higher than if the deceased had a living trust and will already in place.
What are the emotional costs of probate?
If there is a will but no living trust, an executor is likely already named within the will. If there is no will or an executor is not already in place, someone must petition to become executor. Children, other family members, and friends could serve in this position. What becomes difficult is if the family has multiple relatives that wish to be executor. The person who is named executor by the court may be met with hurt feelings or resentment from other family members.
There is a hearing that will determine who the executor will be. The executor is also entitled to collect a fee from the estate for the estimated year of work they will be putting into the process. Some family members choose to waive this fee and feel it is their duty and may regret this decision later upon realizing the enormity of the task and commitment.
What are the financial costs of probate?
California sets the maximum costs that can be charged, but these numbers may be increased by the court if it is a difficult case. The executor is also entitled to fees as well, so they will be doubled if the executor chooses to collect. The fees are based on the value of the estate, regardless of the debts owed.
- 4% of first $100,000
- 3% of next $100,000
- 2% of next $800,000
- 1% of next $9,000,000
- .5% of next $15,000,000
This is actually quite high for attorney fees in comparison to having a will and living trust established.
Other estimated fees:
- Appraiser: .1% of estate value
- Fee charged by court to file $435
- Fee charged by court for final distribution $435
- Fee to newspaper for notices $150-400
There could also be several smaller miscellaneous fees along the way, as well as having the court increase the amounts paid to the probate attorney and executor if it is a particularly complex case.
How can you avoid probate?
To avoid this costly process and all the fees and time it entails, it is most beneficial to the family to set up a will and living trust through an attorney.
By establishing a will and living trust, the family will not have to endure the difficulty of probate and the increased emotional and financial costs.
Our Estate Planning attorneys can help you and your loved ones avoid probate. To get started or to learn more, contact us today.