Estate Planning Practice Blog

Filing Fees to Open Probate.

Probate is one of those things that has an instant cost factor. When you file papers to open an estate, the court charges you a filing fee to submit the papers.

The filing fee for probate cases is based on the size of the estate. If you are not sure about the size or value of the estate when you first open a probate proceeding, you can make an adjustment later in your final petition to close probate. [This is the graduated filing fee adjustment rule.]

The probate filing fee needs to be paid by someone other than the estate initially just to open the case. May I suggest that what your loved one might pay in the filing fee would be better used towards creating a proper estate plan?

2007 probate filing fees in California courts:

First Petition for Letters and Special Letters of Administration; for Letters Testamentary

Estate under $250,000 = $320.00
Estate of at least $250,00 and under $500,000 = $385.00
Estate of at least $500,00 and under  $750,000 = $485.00
Estate of at least $750,00 and under  $1,000,000 = $635.00
Estate of at least $1,00,000 and under  $1,500,000 = $1,135.00
Estate of at least $1,500,00 and under $2,000,000 = $2,135.00
Estate of at least $2,000,000 and under $2,500,000 = $2,635.00
Estate of at least $2,500,00 and under $3,500,000* = $3,635.00

*Anything higher, contact the clerk.

Transferring Real Estate Into Your Trust.

Think of your Living Trust as a fish bowl -- what's swimming in there is part of the trust.  It is an awkward analogy, but if the "fishies" aren't in there -- the trust does not own any assets. You want the trust to own assets so the successor trustee can manage those assets if something happens to you. Otherwise if your trust does not own any assets, it is useless.

To have your real estate owned by your trust, it requires that you actively transfer ownership of your real estate to the trust.

The way to accomplish this is to prepare a trust transfer deed, grant deed or quitclaim deed (I prefer a trust transfer deed) to transfer title from you as a person to you as trustee of your Living Trust. Then if something happens to you, your successor trustee will be able to take over and manage the real estate in the trust on your behalf and in accordance with the trust document.

Here's how this works:

You own your home in Long Beach. It's titled as John Smith as a single man. You set up a John Smith Revocable Trust dated July 1, 2006.

To transfer this Long Beach home to your trust, you will type up a trust transfer deed granting your home from:

John Smith, a single man to John Smith, Trustee of the John Smith Revocable Trust dated July 1, 2006.

Once you record the deed with Los Angeles County Recorder's Office (where your Long Beach home would be recorded, homes located in other California counties would go to their county recorder's office), the home is officially transferred into your trust.

The trust transfer deed must contain other information such as the mailing address for property taxes, whether any documentary transfer tax is owed (here, for a trust transfer there is no tax owed) and a few other particulars.

You also need to prepare a Preliminary Change of Ownership Report to avoid an additional $20 filing fee to accompany your trust transfer deed at the time of recording.

If you refinance, take out a second mortgage, obtain a reverse mortgage or otherwise change the encumbrances on the real estate in your trust, it may have been taken out of the trust during this time. You need to ensure that the real estate is transferred back into the trust after the financial transactions involving your real estate have been completed. This may mean doing this trust transfer deed process all over again.

As always, talk to an attorney if you have questions or need assistance with your Living Trust.

Are You a Special Needs Trustee?

A Special Needs Trust is a very important estate planning tool for caring for loved ones, whether minors or adults, with special needs. Generally these trusts are set up to allow you to provide funds for your disabled child without disrupting the child’s eligibility for government aid. 

Click here to read the recent post that explains Special Needs Trust at length.

The other side of the coin with respects to Special Needs Trusts acting as trustee. There are many issues to consider in your capacity as trustee.

One of these issues is knowing the government aid programs involved with and how they work with regard to the special needs beneficiary.

As trustee, you will have to determine the type and nature of the government aid your special needs beneficiary receives  (e.g., Supplemental Security Income (SSI) and Medi-Cal).  You will also have to understand the reporting rules for government programs as not to prevent a reduction in benefits. And, most importantly, you will need to keep current with new developments regarding these government programs.

This is just one of many important items to take under consideration with Special Needs Trust administration.

If you have questions, please consult with your attorney for more information.