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Disinheriting a child in California is a complex process that involves understanding the law and taking the right steps to ensure that the disinheritance is successful. Disinheriting someone can be done for a variety of reasons, including if a child has financial or legal troubles, if the parent wants to leave something to charity or grandchildren, or if the child is receiving public benefits. In California, it is vital to disinherit someone in writing, acknowledging that person specifically, in order to make the intent clear. Additionally, leaving someone $1 as a way to disinherit them can create problems for the successor trustee in administering the estate.

California Law for Disinheriting a Child:

Under the California Probate Code, if you do not have a distribution plan for your estate laid out in a will or a trust, then the probate code will determine who your heirs are and how much everyone will receive. Typically, when disinheriting someone, it would be someone in your direct bloodline, such as a child, grandchildren, and so on.

Why You May Plan to Disinherit Someone:

There are a variety of reasons why you might want to disinherit someone, and not all of them are bad. The most common bad reasons are if the child has a strained relationship and is no longer in the picture. Similarly, if an inheritance may cause harm to the child such as may be the case for a child with a drug or financial problem, or if the child has outstanding child support or alimony, additionally, you may want to disinherit someone if the parent wants to leave something to charity or grandchildren, or if the child is receiving public benefits and the inheritance would disqualify them from those benefits.

If you do plan to disinherit someone, you should do so in writing and acknowledge that person specifically. Additionally, we recommend you schedule to talk with an estate planning attorney who can advise you on legal options that may be available for your specific situation.

Myths About Disinheriting:

One of the most common myths about disinheriting is that you have to leave the person something, even if it is only $1. Leaving someone $1 as a way to disinherit them can create problems for the successor trustee in administering the estate, as the person will still have the right to receive notice and an accounting of all the trust assets, even if they only receive $1.

Disinheriting a child in California is a complex process that requires understanding the law and taking the right steps to ensure the disinheritance is successful. It is essential to disinherit someone in writing, acknowledging that person specifically. In addition, there may be other tools or strategies that may apply to your situation, which an attorney will be able to advise you to ensure your estate is distributed according to your wishes.

Feel free to reach us directly at (916)-634-1204 to schedule a free consultation to talk about setting up your California estate plan.

A charitable gift in an estate plan is a powerful way to honor your values, interests, and beliefs while providing a lasting legacy for your loved ones. With careful planning and the help of a qualified attorney or financial planner, you can make a real difference in the world while also making sure your estate passes on to your heirs in the most efficient way possible.

Including charitable gifts in your estate plan can provide significant tax benefits. Donations to qualified charities are generally tax-deductible and can reduce both your estate tax liability and the amount of inheritance tax on your estate. Charitable giving can also help you support the causes that are important to you, giving you the satisfaction of knowing your legacy will continue long after you are gone.

When deciding how to incorporate charitable giving into your estate plan, there are several options you can consider.

One option is to simply leave a bequest in your will or living trust to a qualified charity. This is a simple way to make a significant contribution to a cause that matters to you without having to go through a complex estate plan.

Another option is to establish a charitable remainder trust. A charitable remainder trust is a tax-exempt trust that can provide lifetime income to you and/or your heirs, while allowing you to make a contribution to a charity of your choice.

You can also set up a charitable lead trust, which is similar to a charitable remainder trust, but the charity receives the payments first and your heirs receive the remainder. This can be a great way to provide financial support to a charity while also providing your heirs with a financial benefit.

Finally, you can designate a charity as a beneficiary of a life insurance policy or retirement account. When you name a charity as the beneficiary of a life insurance policy or retirement account, the proceeds from these accounts will go directly to the charity when you pass away, without being subject to estate or inheritance taxes.

Incorporating charitable giving into your estate plan can be a great way to make a lasting difference in the world while also ensuring that your estate is passed on to your heirs in the most efficient manner possible. With careful planning and the help of a qualified attorney or financial planner, you can make sure that your legacy will live on even after you are gone.

The frequency with which you need to update the terms of your trust will depend on your individual needs and the specific provisions of the trust. Generally speaking, you should review and update the terms of your trust every few years, or whenever there is a change in your circumstances or the law. You should also review and update your trust when a beneficiary reaches the age of majority or when a trustee is replaced. Additionally, you may need to update the terms of your trust if the value of the trust assets change significantly or if you need to make changes to the trust’s investment strategy. Finally, you should review and update the trust when tax laws change or when you need to make changes to the trust’s distributions or other provisions.

Below are several signs you may need to have your trust reviewed and updated?

1. A change in your or a beneficiary’s circumstances.

2. A change in the law.

3. A beneficiary reaching the age of majority.

4. A change in the value of trust assets.

5. A change in the trust’s investment strategy.

6. A change in tax laws.

7. A change in the trust’s distributions or other provisions.

8. A replacement of a trustee.

What is the consequence of not updating your trust regularly?

If you do not update your trust on a regular basis, it could mean that the trust does not reflect current laws and regulations, which could lead to costly and time consuming legal disputes. Additionally, an outdated trust might not reflect your current wishes, which could leave your assets at risk and lead to unintended consequences for your beneficiaries.

Get Help From Our California estate lawyers

If you need help understanding the process of updating your trust, or if you would like to make sure that it is up to date and in compliance with the law, you should consider consulting with an experienced California estate planning lawyer. A qualified lawyer can help you understand the legal requirements and ensure that your trust is properly updated.

How Does One Become An “Executor?”

An executor, also known as a personal representative, is a person appointed by a court to manage the distribution of assets and payment of debts of a deceased person’s estate. In California, the duties of an executor are governed by the Probate Code, which outlines the responsibilities and powers of the executor in the administration of the estate.

What are the Practical Duties of the Executor?

One of the primary responsibilities of an executor is to gather and inventory the assets of the deceased person’s estate. This includes identifying and locating all assets, such as real estate, personal property, bank accounts, and investments, and determining their value. The executor must also identify and notify any known creditors of the estate, and pay or make arrangements to pay any debts, taxes, and expenses of the estate.

The executor is also responsible for distributing the assets of the estate to the beneficiaries in accordance with the terms of the will or California’s laws of intestate succession if there is no will. This may include selling assets, transferring property, and making cash payments to beneficiaries. The executor must also prepare and file any necessary court documents, including an inventory of the estate’s assets and a final accounting of the estate’s finances.

Another important duty of an executor is to appear in court when necessary to answer any questions about the administration of the estate. This may include attending hearings to request court approval of certain actions, such as the sale of real estate or the distribution of assets to beneficiaries. The executor must also represent the estate in any legal proceedings, such as will contests or disputes over the distribution of assets.

What Is the Fiduciary Duty of an Executor?

In addition to these specific responsibilities, an executor also has a general duty to act in the best interests of the beneficiaries of the estate. This includes keeping beneficiaries informed about the progress of the estate administration, and providing them with any information they request about the estate. The executor must also avoid conflicts of interest and refrain from using their position for personal gain.

However, being an executor is not easy, it is a huge responsibility that requires a good deal of time, effort, and attention to detail. The executor must familiarize themselves with the probate process, including the requirements of the California Probate Code, and must be prepared to spend a significant amount of time managing the estate’s assets, paying debts, and communicating with beneficiaries.

Additionally, the executor must be able to manage the finances of the estate and make decisions regarding the sale or distribution of assets. This may include working with real estate agents, attorneys, and other professionals to manage the estate’s assets and resolve any legal issues that may arise. The executor must also be able to communicate effectively with beneficiaries, who may have different expectations and interests regarding the distribution of the estate’s assets.

In conclusion, being an executor is a complex and demanding role that requires a great deal of responsibility and attention to detail. The executor must be able to manage the estate’s assets, pay debts and taxes, and distribute assets to beneficiaries in accordance with the terms of the will or California’s laws of intestate succession. They must also be able to navigate the probate process, communicate effectively with beneficiaries, and make difficult decisions regarding the distribution of the estate’s assets. It’s a challenging role, but one that comes with the important responsibility of managing the final wishes of the deceased, and ensuring that their assets are distributed fairly among their loved ones.

Please note: This website provides information, content, and materials that are not intended to provide legal advice, but rather serve as a general resource for information. Information on this website may not constitute the most up-to-date legal or other information. Please schedule a free consultation to talk with an estate attorney for answers to your specific legal questions and legal advice for your specific case.

Your estate plan should incorporate any assets you own as investments, such as second homes.

Estate planning for rental property owners is a bit different than for those who own their primary residence. Since rental properties are usually considered business assets, they can be subject to different taxation rules and require special consideration when creating an estate plan.

Why is Estate Planning important for Real Estate Investors Owners?

Estate planning is an important part of financial planning for real estate investors. Estate planning helps to ensure that your assets are distributed according to your wishes after you pass away. It also ensures that your heirs are not burdened with unnecessary taxes or legal fees. Additionally, estate planning can help to protect your assets in the event of a lawsuit or other legal dispute. Without an estate plan, your assets could be subject to probate, which can be a lengthy and expensive process. An estate plan can help to make sure that your assets are distributed according to your wishes, and that all of your beneficiaries are taken care of.

What are common Concerns Real Estate Owners consider as part of their estate planning

Real estate owners often have to consider a number of issues when creating an estate plan. One of the most important considerations is ensuring that the property is properly titled and that the deed is properly recorded. Additionally, real estate owners should consider whether or not they wish to keep the property in their name or transfer it to an LLC or other entity. It is also important to consider how taxes will affect the estate, and to ensure that all necessary documents and paperwork are in order. Finally, real estate owners should also consider how they wish to pass on the property to their heirs.

Here are three tips to help you plan for the future of your rental property when creating your estate plan:

1. Choose the Right Entity

The first step when creating an estate plan for rental property owners is to choose the right entity to hold the property. For instance, some rental property owners choose to hold their properties in a limited liability company (LLC). This type of entity provides liability protection for the owner and can help to separate personal assets from business assets.

2. Determine How to Pass on the Property

Once you have chosen the right entity to hold the property, it is important to determine how you want to pass on the property. This could be done through a will, a trust, or even a transfer on death deed. These are all tools that can be used to pass on rental property to your heirs.

3. Consider Tax Implications

When creating an estate plan for rental property owners, it is important to consider the tax implications of the plan. This includes any taxes or fees that may be applicable when transferring the property to your heirs. It is also important to consider whether or not the rental property will be subject to estate taxes, which can vary from state to state.

By considering these three tips, rental property owners can ensure their estate plan is properly structured to protect their investment.

Creating an estate plan can be a complicated process, especially for those with rental properties. However, taking the time to consider how your rental property should be handled can help to protect your investment and ensure that it is passed on to your heirs in the most efficient way possible.

How can an estate attorney can help when planning an estate plan with Rental Properties?

An asset protection lawyer can help real estate owners when creating an estate plan for their rental properties. An asset protection lawyer can help to ensure that the property is properly titled and that the deed is properly recorded. Additionally, an asset protection lawyer can advise on the best way to transfer the property to heirs or to other entities. Furthermore, an asset protection lawyer can help to ensure that all necessary documents and paperwork are in order and that any taxes or fees associated with the transfer of the property are taken care of. An asset protection lawyer can help to make sure that your estate plan is structured properly and that your heirs are taken care of.

California laws surrounding inheritance are complex, even in situations where there is a comprehensive estate plan. Even if you do not expect it to happen, there is still a chance the heirs to your property could disagree with their inheritance after you’re gone. By speaking with an attorney experienced in California inheritance law, you can make a clear plan for how your assets will be managed and distributed, so there is no room for dispute.

At California Probate and Trust, our estate attorneys can develop a customized and effective inheritance plan that meets all your needs.

Developing an Inheritance Plan with an Estate Planning Attorney

When you consult with an attorney at California Probate and Trust, we will discuss the details of your assets and how you would like them to be distributed after you’ve passed away. We will then come up with an inheritance plan to address both your assets and debts. An inheritance plan for liquid assets looks different than one you would use for assets such as property, bonds, and securities. We will evaluate the types of assets you want to give your beneficiaries and ensure they will properly inherit them.

At the same time, we will also consider the financial situations of each of your beneficiaries. This step is important because their life will change, either a little or a lot, when they receive their inheritance. We’ll consider their debts you know about and whether they have an estate plan already. Using this knowledge, we can make the necessary arrangements so they receive their inheritance in a manner that is beneficial rather than burdensome.

The team at California Probate and Trust have many years of experience in helping individuals get peace of mind about the future of their assets. The result of our work together is a smart and efficient plan that will properly distribute your beneficiaries’ inheritance under California law.

Contact Our California Team Today

Our firm helps high net worth clients with planning and protecting their wealth legally. Our firm has the knowledge you need to handle all matters involving inheritance preparation and/or estate planning under California law. Every situation is different, and our approach is completely personalized and customized to your unique situation and goals for today and the future, for you and your family.

If you need assistance or advice, please contact our professionals to discuss the details of your situation. Call (916) 634-1204 to speak with a member of our team today.

A revocable trust, also known as a living trust, is a legal document that allows an individual (known as the grantor or trustor) to transfer their assets into a trust that is managed by a trustee for the benefit of the trust’s beneficiaries. In California, homeowners have several reasons for why they should consider creating a revocable trust as part of their estate planning.

One of the main reasons for having a revocable trust is to avoid probate.

Probate is the legal process of distributing a deceased person’s assets to their beneficiaries. In California, probate can be a long and costly process that can take several months or even years to complete. By placing their assets into a revocable trust, homeowners can avoid the probate process and ensure that their assets are distributed to their beneficiaries in a timely and efficient manner.

Another reason for having a revocable trust is to maintain privacy. Probate proceedings are public, which means that anyone can access information about the deceased person’s assets and beneficiaries. By placing their assets into a revocable trust, homeowners can keep the distribution of their assets private and protect the privacy of their beneficiaries.

A revocable trust also allows homeowners to plan for the possibility of incapacity.

If the grantor becomes incapacitated, the trustee can step in and manage the trust assets on their behalf. This can be particularly important for homeowners who have a large estate or complex financial holdings, as it ensures that their assets are managed and protected even if they are unable to do so themselves.

A revocable trust also allows homeowners to protect their assets from creditors.

Once assets are transferred into a trust, they are no longer considered the property of the grantor and are thus protected from creditors. This can be particularly important for homeowners who are concerned about the possibility of lawsuits or other legal actions.

Finally, a revocable trust allows homeowners to control how their assets are distributed after their death.

The grantor can specify in the trust document how their assets should be distributed to their beneficiaries and can even include conditions or restrictions on the distribution. This allows homeowners to ensure that their assets are distributed in a manner that reflects their wishes and provides for their loved ones.

In conclusion, California homeowners have several reasons for why they should consider creating a revocable trust as part of their estate planning. A revocable trust can help avoid probate, maintain privacy, plan for incapacity, protect assets from creditors, and control how assets are distributed after death. It’s a valuable tool for anyone looking to ensure the efficient and orderly distribution of their assets and for protecting their loved ones. However, it’s important to note that a revocable trust is just one of many estate planning tools available and should be considered with your estate planning attorney in the context of an overall estate plan.

Please note: This website provides information, content, and materials that are not intended to provide legal advice, but rather serve as a general resource for information. Information on this website may not constitute the most up-to-date legal or other information. Please schedule a free consultation to talk with an estate attorney for answers to your specific legal questions and legal advice for your specific case.

Estate planning is an essential task that all individuals should undertake, regardless of their age or net worth.

It allows you to plan for the future and ensure that your assets are distributed according to your wishes. However, creating an estate plan can be a complex and confusing process, and many individuals choose to hire a lawyer to help them navigate the process. In this blog post, we will discuss the benefits of hiring a lawyer to help you create your estate plan.

Legal Expertise:

An estate planning lawyer has the knowledge and expertise to help you navigate the legal aspects of estate planning. They can advise you on the best legal documents to use, such as a will, establishing a trust, or power of attorney, and ensure that your documents are legally valid and enforceable. They can also help you understand the tax implications of your estate plan and ensure that you are taking advantage of any tax benefits that may be available to you.

Customized Solutions:

A lawyer can help you create a customized estate plan that is tailored to your specific needs and goals. They can take into account your assets, family dynamics, and future plans to create an estate plan that is right for you. They can also help you plan for any contingencies, such as incapacity or long-term care, and ensure that your assets are protected in case of any unforeseen events.

Peace of Mind:

Hiring a lawyer to help you create your estate plan can give you peace of mind knowing that your assets are protected and your loved ones are provided for. A lawyer can ensure that your estate plan is legally sound and that your assets will be distributed according to your wishes. They can also help you avoid common mistakes that can be costly and time-consuming to fix in the future.

Time-Saving:

Estate planning can be a time-consuming process, but hiring a lawyer can save you time and effort. A lawyer can handle the legal paperwork, research, and other tasks associated with estate planning, allowing you to focus on other important matters.

Cost-Effective:

While hiring a lawyer may seem like an added expense, it can actually be cost-effective in the long run. A lawyer can help you create an estate plan that is tailored to your needs and goals, which can save you money in the long run by avoiding costly mistakes and potential legal issues.

In conclusion, estate planning is an important task that all individuals should undertake. Hiring an estate lawyer to help you create your estate plan can offer many benefits, such as legal expertise, customized solutions, peace of mind, time-saving, and cost-effectiveness. An experienced lawyer can help you navigate the legal aspects of estate planning, ensure that your documents are legally valid and enforceable, and ensure that your assets are protected and your loved ones are provided for. It’s important to consider the value of hiring a lawyer when planning your estate.

Please note: This website provides information, content, and materials that are not intended to provide legal advice, but rather serve as a general resource for information. Information on this website may not constitute the most up-to-date legal or other information. Please schedule a free consultation to talk with a lawyer for answers to your specific legal questions and legal advice for your specific case.

Dustin Macfarlane discusses the outcome of the famous pop singer’s (Prince) estate and how much money his heirs will not be receiving because he didn’t have an estate plan. He will dive into how a simple estate plan could have protected the singer’s money and provided a much larger inheritance.

Full Transcript from California Probate and Trust’s September 09, 2022 Podcast Episode 13 – Prince’s Estate & Probate

Hello, and welcome. You’re listening to Legally Speaking Podcast and Radio Show. My name is Dustin McFarland, and I own California Probate and Trust. We’re a law firm dedicated exclusively to helping California families protect their assets, avoid family drama, and eliminate government interference. If you are concerned about what’s going to happen to you and your affairs, your stuff, your money, your assets when you pass away, give me a call today. The number is (866) 674-1130. Again, (866) 674-1130. Prince Rogers Nelson, born June 7th, 1948, died April 21st, 2016. Prince died six years ago. 2016, he passed away. And just this week, we got the news that they are finalizing his probate estate, finalizing the probate, distributing the assets. So, what is probate, and why does it take so long? And why do we even have it? And oddly, not every state has probate, or every state has probates. Some states are really, really simple, very, very little government involvement.

And then apparently when… Obviously California, it’s all government all the time, and government wants to be heavily involved. It looks like Minnesota, because there was a contest, meaning because people were arguing over who got what and what percentage, the government does get involved. And essentially, everybody suing each other, which is just horrible for a family to go through. So in Prince’s case, his estate was probably larger than most of our estates. His estate was a hundred… It was finalized at $156 million. That’s a number they settled on. It’s important because it’ll tell how they… First, it’ll tell how much taxes owed. So, that’s a big number. And so the IRS had its fingers in this too, because if the estate was valued at a higher number, and the IRS gets 40% of it, that’s more money to the federal coffers, and they liked that.

So, this was a six year battle trying to figure out how to divide Prince’s estate. So, why was Prince in probate? Prince was in probate, and just like all of us would wind up in probate if we die intestate. Intestate means that we die without a will. Prince did nothing, no will, no trust, no… He put forth no effort to direct or give instructions to anyone regarding his estate upon his passing, nothing. He left it up to the state law and state legislators. And every state has its own set of rules built into their state law called in test state succession. Intestate succession is just the state default distribution plan if you die without a will or without a trust. And it really then is dependent on your family and how they’re related, and what generation they are, and when you receive the money, and if there are any other co-owners, and it’s just this big kind of convoluted mess.

When we explain this to people, they almost can’t wrap their head around it sometimes because the state just has its own way to do it. There’s not many laws that you can just modify on your own. And this is one of the real… If you remember nothing else from our conversation today, remember this, estate planning, and really intestate succession, this is the one area of law that you can just modify the law and change it how you want it to be. I wish we could do that with the tax code or with the speed limit. That would be awesome. I would modify it to say I could go a hundred miles an hour, but this is the only area of law that you can really just say, “You know what? I don’t want to do the default in test state succession. I have my own ideas about my family or about charities or churches,” or however you want to your estate to be divided up.

You can divide it. We can all divide it for ourselves. You can divide up your estate and lay out that distribution plan upon your passing however you want. No one really can interfere with that. The only time intestate succession comes into play is when you do nothing, when you have no involvement, you don’t write down on a napkin what you want to have happen. You just completely leave it up to the government, and that’s exactly what happened to Prince. He passed away. And so there were people who said, “Hey, I have a contractual interest in this estate. It should go to the company, the music company.” And other family members, these half siblings said, “No, we have an intestate succession right to the estate. It should go to us, the family.”

And then the IRS gets to step in and says, “Well, you guys are all cute, but we have a right to 40% of anything in excess of three and a half million dollars that is coming to us.” And so the IRS will get paid its 40% of, essentially $150 million. That goes. There is no question. The attorneys, they obviously get paid. Anytime we’re in court, know that the attorneys are getting paid. And so that is definitely going to happen. That’ll be several million dollars. The trustee or the executor, that’ll be several million. So, let’s talk about these players and how this kind works, and again, why it’s there, and most importantly, what you can do to avoid this.

So, intestate succession. In California, intestate succession is the plan, the default distribution plan for your assets. It’s different based on whether or not you’re married or whether or not you have children, whether or not you have siblings or parents or grandparents. It really is unique to you. And the biggest ones that we see are individuals who are not married and they pass away, and they have children. And if they die intestate, meaning without a will, then the state says, if you’re not married… And there’s even some caveats on that, if you were married and when your spouse died and how you received the property, but we won’t go into the technical details. Just know that there’s an asterisk on this example. But like Prince, not married, so it’s going to go to children. Well, Prince didn’t have any children. So then it’s going to go up to parents.

Well, his parents were deceased. So, then we’re going to go back down to his siblings. And that’s kind of where it settled, is the six half siblings. And I don’t care if they’re half siblings. If the state law says that they’re treated as full-blooded siblings, then that’s just how they’re going to be treated. It just doesn’t matter. So, the state law said that it goes to spouses. Well, Prince wasn’t married, so no spouse. It goes to children. Prince didn’t have any children. So, then where do we go? We go to parents. Both of his parents died before him, so it doesn’t go to parents. It goes to… Then we go… And if you can imagine it like a tree. We go down… Well, we go across to spouse and down to children. When we run into a dead end, we turn around and we go back up to parents.

If parents are deceased, we go out to siblings, brothers and sisters. And then that can include not only half siblings, but also adopted siblings. Again, every state is a little different, but California is going to include adopted and half siblings. And sometimes, it depends on the parents… Generally, it’s not step siblings, but I guess it depends on which parent is alive or deceased. And then we’re going to go down to siblings. And so Prince had these half siblings that are going to get their intestate share of the estate. The problem is that there’s also this record company. And the record company says, “Oh, hold on, hold on. We have a contractual interest. We gave Prince money. In return, he gave us rights, whether it’s royalty or whatever royalties to own some of the intellectual properties, some of the music, the albums, the creations that Prince came up with.”

And so this company and the family had been fighting for six years trying to figure out who gets what. And so essentially, and they’re probably all unhappy about this, but that’s just how the courts work. Essentially, half of the estate will go to… So first of all, 40% of the estate will go to the IRS. A lot of people are worried about the estate tax. CNN calls it the estate tax or the wealth tax. Fox News calls it the death tax. It’s all hyperbole. Really, it’s anything over, at that time, when Prince died, it was three and a half million dollars, is going to be taxed at 40%. Right now, these numbers are higher, but back then in 2016, it was three and a half million. So, you figure on $156 million estate, like $153 million is going to be taxed at 40%. All that’s going to go straight to the IRS, so they’ve got to come up with ways to finance that. And that’s, again, difficult because this estate is not a liquid estate.

It’s not like there’s $156,000 in cash sitting there. That would’ve been easy. It’s not like there’s $156,000 of real estate sitting there. That would’ve been easier. We’re talking about rights, ownership rights, royalty rights, owning intellectual property in all of the music. And valuing that and knowing how to get money out of that is what’s difficult. So, they’ve got to come up with ways to sell, and well, to value, which it took six years, and then divide, and now liquidate. They’re going to have to pay the IRS this estate tax, which they can’t avoid. It’s coming. But know this, know that most people don’t have enough wealth to qualify for this estate tax. Right now, it’s $12 million per person. Back when Prince died, it was three and a half million dollars per person. We don’t need to worry about the estate tax, but the probate court is going to make sure that the IRS gets paid first.

Then the probate court is going to make sure that the lawyers get paid. Then the probate court is… So, every time you have a… So, let’s talk about probate and who the players are. So number one, we always know that the government is involved. So, there’s the state court that’s involved. And a lot of times, we have to pay a little bit of nominal money to the state court. That’s just kind of peanuts in this case. We have to… If there’s any taxation, we know that the IRS or the estate or any other tax agency is going to have their fingers in the cookie jar. They’re going to be involved. Every estate that, not state, but E-S-T-A-T-E, every time we go to probate, there needs to be one person, or probably in this case, a company, who is in charge of managing and holding onto and preserving and ultimately paying checks and distributing the estate. That person is called the personal representative, the administrator, or the executor. If you do your will, we call it the executor.

But if you don’t have a will, California calls it, kind of depending on the circumstances, either an administrator or a personal representative. There’s always a personal representative. There’s always an administrator of the estate. And you think, well, why does there have to be a person? Think about this. There literally has to be a person to sign the deed, to sign a listing agreement to sell your house. There literally has to be a person who can get in the car, drive to the bank, withdraw the money, write the checks, and send it to the beneficiaries. There literally has to be a human being that hires the lawyer, that goes to court, that talks to the judge. There has to be a human. So, every single time somebody dies, there is at least one person involved in shutting down and gathering the assets, paying your bills, paying your taxes, distributing your assets, and then shutting down the probate case. There has to be a human to do that. And we pay these people. We pay them handsomely, in fact. They get a percentage of the estate.

So in this case, in Prince’s case, the administrator of the estate, and it’s a company, but the administrator of the estate is getting about $3 million. Not a bad gig if you can get it. I mean it’s four, six years of work, but I don’t know, $500,000 a year for six years, that’s not a bad day at the office. So, there’s always an administrator. We would much rather have an administrator that you choose instead of one appointed by the court. If you die without a will, that person’s going to be appointed by the court. And you may not know. They don’t really care. The ones that are appointed by the court, they are not emotionally attached to anything. They will sell anything. It does not matter to them.

It is just stuff. And there is no sentimental value, no heirlooms, no emotional interest, no nothing. It’s like, let’s just sell it, distribute it, and move on. And so that’s what administrators and executors do. If you have your own will, you can decide who’s in charge. Well, Prince didn’t do a will, so the court appointed a company to be the administrator of the estate. No administrator’s going to act alone, so every single administrator hires a lawyer, and the lawyers are going to get paid. Here in California, the administrator and the lawyer get paid the exact same amount of money. So, everyone says, “Oh, the lawyers, they just rape you on the estate. They get paid so much money.” Well, guess what? They don’t get any more money than the administrator. And probably, in most cases, the lawyer is doing most of the work. So, you can double up.

If, in California, the administrator gets $50,000, the lawyer gets 50,000. In California, if the administrator gets paid 100,000, the lawyer gets paid 100,000. It is dead even every time. And in California, there’s a very clear schedule of how to pay administrators and lawyers. It’s super clean. It’s set by state law. And anyway, there’s no arguing. There’s no negotiating, or well, what if, maybe. That’s not how it works. The judge sets the rules and follows the state law and just hands it down from Mount Sinai. Just the rules come down from on high, and there’s nothing you can do but follow the rules. So, you have an administrator. Every administrator has an attorney. And then the other people, they are heirs. So in Prince’s case, there’s a production company. They’re not heir. They have an interest because of a contract.

And I remember reading… I tried to find it for this bit, it’s been, I don’t know, six years. I remember reading initially that that contract was probably a verbal contract between Prince and the production company. Not ideal to have verbal contracts, because no one else knows what the heck you say. So, write stuff down. But he has this contract with his production company. And then you have heirs. Now, a lot of times when we’re talking about wills and trusts, we talk in terms of beneficiaries. Beneficiaries are people we designate. We’re like, “You know what? I designate John and Sue and Jane,” and whatever, specific people. But if you just ignore that responsibility and you decide, “You know what? I’m not doing a will. To hell with it. I’ll just let the government decide who gets what I have,” then you have what are called in testate heirs.

And the government, they don’t even have to guess. They just look at their state law. So in California, they look at the law and they say, “Okay, well these people are alive and these are the family members that you have,” whether you have a spouse or children or parents or siblings or nieces and nephews or whatever. And then they say, “Okay, well, here’s the percentages.” And literally, we can just go down the list and we can divide it up based on percentages. I know exactly… Unless there’s some sort of contest and people are fighting and someone can prove something otherwise, I can calculate, almost to the penny, what fractional interest, what your percentage is going to be of an estate, because it’s all laid out in state law. And what is so surprising is most people don’t really want it to go that way.

They want to take care of their spouse. They want to take care of their kids, maybe one kid more than another. They want to take care of a church or a charity or some cause that they’re behind. Prince didn’t do any of that, nothing. He left it all to just whatever the state law is. And if this was California, and I’m sure it’s very similar in Minnesota, the state looks at the family and they say, “Okay, well first we’re going to look to see if you’re married, and do you have children?” Well, Prince, not married, Prince, no children. So in California, we go to spouse and children first. So, it goes across and down. If you think about that, if you’re kind of mapping out the family, and you and your spouse are on the same line and the children are below, you go across and down at the same time.

Well, that didn’t happen for Prince because he didn’t have a spouse, not married, and no children. And so then we go, “Okay, well let’s go up.” And when I say up, I mean we go to parents. So, we go and look, are Prince’s parents alive at the time that he passed away? And the answer is no. Prince’s parents both deceased. So then we go, “Okay, well, now what do we do? Who inherits this money?” Well, did Prince have any siblings? And the answer is yes. He has six half siblings. So, then we go across, Prince’s same generation, Prince’s same generation, in the same generation, meaning his siblings that are on the same generation. They’re not his nieces and nephews. They’re not his uncle, aunts, and cousins. His siblings all are going to share an equal percentage. Now, it’s like the plot thickens now it’s been six years, and two of these people, two of the six, have also passed away since Prince died.

And that means, if those people didn’t have wills, in fact, I already know there’s going to be two more probates to probate those estates because each one of those shares is going to be worth… I haven’t done the math, but 175 divided by six, 10, 12 million, even if it’s 6 million after the… It’s going to be a significant amount of money. And so there’s going to be two more probates, which is going to be two more lawyers, two more courts, two more executors or administrators of those estates in wherever they lived, and it’s just going to go on and on. People don’t have their act together. And because of that, it just creates more mess and drama and more mess and drama and more mess and drama. It just never ends. So, Prince’s $156 million estate is going to be carved up into these little teeny chunks.

I mean 40% off the top is going to the IRS, and that leaves us with roughly 80 million. I’m kind of doing the math in my head, but roughly $80 million. And then maybe Ryan will do the math and put it up on the screen for me, but 80 million. And then of that, we’re going to split it half to the production company and half to the kids, and that’s 40 million each. And then the kids are going to share it six ways. So, 40 divided by six is just under seven, six and a half to each kid. And each kid is going to take then… And then there’s two of those that are going to be probated again. And if they were… Yeah, so there’s going to be another mess on their hands. It’s like it just…

It’s almost a comedy of errors. And all of this is just so avoidable. You don’t want to be in a probate court, mostly because it just, it’s an open forum to give the world, whether it’s the IRS or creditors or former business partners, it gives everyone the opportunity for their day in court. They can come in and complain and say, “Hey, I was owed money. I should get part of that.” And that happens. I’ve seen shakedowns happen. I’ve seen beneficiaries, “beneficiaries” come in out of the blue, and their strategy was this, makes so much noise that giving them 20 or 50,000 or whatever is faster and cheaper than fighting the truth. And in Prince’s case, there was enough money at stake that everyone was willing to fight. They fought for six years until finally, it was settled on the amount, and it was settled on the percentages, and it was settled on who is going to get what. And so again, the IRS, they’ll get paid first. The administrator will get paid, the lawyer will get paid, and then whatever’s left will be divided up how the court divides it.

And the question is, do you want your family to go through this? Six years, that’s a long time. It’s not the longest I’ve ever heard, but it’s a long time. In California, it’s one year minimum. One year. I mean, if you do it really tight and the court is on point and there’s no delays, you could probably get it down to nine months, 10 months. In a post-COVID world where everything is just delayed just for no apparent reason, just because, it’s probably a year plus. We’re seeing 18 months as normal now. And you think about it, people are depending on that. I mean they shouldn’t, but they are. They’re saying, “Hey, mom passed away. I need to inherit this because we need this money.” It’s like, sorry, the court’s involved. Well, it just has to be sold and given to me. I’m the only child. So? The court’s involved. Nothing that the government does is fast or efficient.

Nothing the government does really goes like this. I mean, if you go to the DMV, you know you’re going to spend some time, If you’ve got to send something to the IRS or send something to any sort of government agency, you know you’re going to spend some time. And you know if you’ve got to go to court, you’ve got a ton of rules to follow, and procedure and timeframes and stuff that you are just so beyond your control. And it’s baked in the system to make sure that taxes are paid and creditors are paid, and everyone has their opportunity to do this. How can this be avoided? The number one way to do this is to just have a trust with all of your assets in your trust. Wills do not avoid probate. Wills really just rewrite the distribution scheme.

A trust allows you to avoid probate. The question is, how important is this to you and really to your children? What impact would this have on your children if they had to wait 18 months and hire an attorney and an executor for $50,000 each? How would that impact your family if they had ended up inheriting a hundred thousand dollars less that went to an executor and to an attorney? How would that impact your family if you passed away and they’re dragged through a court proceeding? Maybe it’s not six year. Maybe it’s three. Maybe it’s one, but it’s still not simple and efficient. It has a negative impact on your kids, a financial impact, a real financial impact. Prince did not care. He didn’t have a spouse or children to protect. He just said, “To hell with it. Whatever. They can fight when I’m dead.”

And that is one approach. I would argue that if you’re married, if you have children, that’s not your approach. No father, no mother has ever said, “To hell with it. Let the kids fend for themselves.” We just don’t do that. We do everything we can to protect our family. Let me know. Give me a call. Let’s talk about how we can make sure your family does not go through the hell that Prince’s family went through. Whether it’s a hundred million dollars or a couple hundred thousand, it is worth protecting and keeping your family out of court. You can reach me at (866) 674-1130. That’s (866) 674-1130. My name is Dustin McFarland. This is all we do. We won’t waste your time. We will take care of you. You will be happy with knowing that your family won’t go through this mess and be strung out in a long, expensive, and unnecessary court proceeding. Keep the government out of your lives and take care of your family. Again, my phone number is (866) 674-1130. Give me a call. I’d love to sit down and talk with you. Have a great day.

When you create an estate plan, you have the option to include a revocable trust. Also known as a living trust, this document allows you to choose how your assets are distributed upon death. You can retain control of the trust while you are alive and even make changes if you wish. A revocable trust also protects you if you become incapacitated, allows your heirs to avoid probate, and so much more. Properly creating and funding your trust is vital. If you make a mistake, your loved ones might have trouble accessing their inheritance. Fortunately, R. Dustin MacFarlane of California Probate and Trust, PC has spent years helping seniors create trusts. As a top trust attorney, our team create customized legal documents for clients to ensure they enjoy all of the protections and benefits.

Benefits of a Revocable Trust

Many people visit a revocable trust lawyer so they can enjoy the benefits provided by such a document.

  • Avoid probate.
  • Choose someone to manage assets if you aren’t mentally competent.
  • Select how assets are distributed.
  • Determine who gets assets.
  • Maintain privacy regarding your estate.

Plan for the Future with a Revocable Trust Attorney

When you create an estate plan, you have the option to include a revocable trust. Also known as a living trust, this document allows you to choose how your assets are distributed upon death. You can retain control of the trust while you are alive and even make changes if you wish. A revocable trust also protects you if you become incapacitated, allows your heirs to avoid probate, and so much more.

Properly creating and funding your trust is vital. If you make a mistake, your loved ones might have trouble accessing their inheritance. Fortunately, R. Dustin MacFarlane of California Probate and Trust, PC has spent years helping seniors create trusts. As a top revocable trust attorney, he creates customized legal documents for clients to ensure they enjoy all of the protections and benefits.

Benefits of a Revocable Trust

Many people visit a revocable trust lawyer so they can enjoy the benefits provided by such a document.

  • Avoid probate.
  • Choose someone to manage assets if you aren’t mentally competent.
  • Select how assets are distributed.
  • Determine who gets assets.
  • Maintain privacy regarding your estate.

Amending A Revocable Trust

A revocable trust allows you to maintain full control over your assets during your lifetime, as long as you are of sound mind. Many people choose to amend a revocable trust after getting married, getting divorced, or having a child. You can also amend your trust if you want to change how the property is distributed or add or remove beneficiaries or property. Your trust lawyer will help you make all necessary changes, ensuring that it meets the legal requirements set forth by the state of California.

Add A Pour-Over Will To Your Estate Plan

Your revocable trust attorney might recommend a pour-over will along with the trust. If you overlook some of your assets and fail to put them in the trust, your executor can transfer them if this document is in place. While those assets will have to go through probate, they will be subject to the terms of the trust after the process is over.