A lot of people fail to plan ahead for something that is definitely going to happen. If you were to die without executing any estate planning documents, you would die intestate. Under these circumstances, the state would be forced to sort things out.
The probate court would step in, and after final debts were paid, the probate property would ultimately be distributed using the intestate succession laws of the state of California.
Before we explain the pecking order as it were, we should point out the fact that some asset transfers would not be subject to this process. If you have insurance policies, the beneficiaries that you name would receive their payments from the insurance companies after your passing.
Some people create payable on death (POD) accounts at banks and brokerages. With this type of account, you name a beneficiary. Even if you did not have a will, the beneficiary would inherit anything that is left in the account after you pass away. There are a number of potential drawbacks to the use of POD accounts. Accordingly, you should consult with an experienced and qualified estate planning attorney before using them. Do NOT rely solely upon the advice you may receive by a banker and stockbroker. They simply do not have the education, training and experience to fully advise you about the consequences of using POD accounts.
Joint tenancy is the condition of co-ownership of property. If you were to add a joint tenant to property that you own, the joint tenant would inherit the entirety of the property after your passing, whether you had a will or not. Once again, there are a number of potential drawbacks to the use of joint tenancy. What may seem like a simple and easy approach can have unintended bad creditor and tax problems. Again, it is best to should with an experienced and qualified estate planning attorney before using them.
When it comes to probate property, which would be property that was in your sole personal possession at the time of your passing, your closest relatives would be in line for inheritances under the intestate succession laws.
If you had children still living but no surviving spouse, parents, or siblings, your children would inherit everything. Your spouse would inherit everything if you had a surviving spouse and the estate was community property. However, she would only inherit one half of your separate property.
These are just a couple of the possibilities, but sections of the intestate succession laws address every type of familial situation. The rules can be complex and, for many persons, like unmarried companions, extremely unfair.
In some cases, people with no apparent living relatives die intestate. Under these circumstances, the state would allow some time for someone to come forward claiming to be a relative.
If no one is found within three years of the passing of the decedent, the state could absorb the probate assets under escheat laws.
Action Is Required
Estate planning is a basic responsibility that comes along with being a self-supporting adult. It can seem as though you will always have time to plan your estate at the very end of your life, but this a risk that is not worth taking.
Action is required if you are going through life without an estate plan. We would be glad to help if you want to make sure that your final wishes are honored. To set up a consultation, simply call our office.