San Diego Estate Planning Lawyer Blog
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While real estate and cash are the first assets you might think about in connection with estate planning, you should not neglect your stock portfolio. According to a 2015 Gallup poll, approximately 55% of Americans have money invested in the stock market. The law in California and many other states offers a process for transferring your stock without having to go through a formal probate process.

What is a TOD Registration?

Although stock offerings are regulated by the federal government through the U.S. Securities and Exchange Commission, the actual registration of stock ownership is handled under state law. And just about every state has adopted the Uniform TOD Security Registration Act. The “TOD” stands for “transfer on death.”

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Signing a last will and testament is often not a one-time affair. You may in fact execute several wills over the course of your lifetime. While a “last” will usually refers to the document signed most recently before your death, there are occasions when a California probate court may find good cause to admit an earlier will.

Judge Nullifies Will Favoring Stepdaughter Over Biological Children

For example, in a recent case from Los Angeles, a state appeals court upheld a probate judge’s decision to admit a decedent’s next-to-last will over his last will. The probate court found the last will was the product of undue influence but the previous will was not. The court therefore admitted that will to probate over the objections of the decedent’s children.

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Estate planning is typically concerned with a person’s tangible possessions and assets. But in the modern age when more of our lives exist online, how does estate planning deal with so-called digital assets? The California legislature may attempt to answer that question in a bill now pending before the state Senate.

When you sign up for an online service like Google, Facebook, or Twitter, there are “terms of service” set by the provider that may explain what happens to your data in the event of your death. Facebook, for example, allows its users to provide instructions to “memorialize” or delete an account upon death. A memorialized account maintains the user’s data—photos, messages, et al.—but otherwise prevents anyone, including the personal representative of an estate, to access the actual account.

As the law in California presently stands, there is no uniform rule for how online service providers must deal with the post-death disposal of a user’s digital assets. California Assembly Bill 691 (AB 691) would change that. The bill, which was approved by the Assembly last year and recently cleared a Senate committee, would adopt a version of the Fiduciary Access to Digital Assets Act, a model law already adopted by about a dozen states.

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Recently a California appeals court faced an unusual situation. A woman wanted to reopen her late husband’s estate nearly 25 years after his death. The widow claimed there was a “clerical error” in the original probate court order that led to the unintentional omission of her children from a prior marriage—that is, her husband’s stepchildren—from inheriting part of his estate.

Under the husband’s will certain property, notably three pieces of real estate, was placed with the wife in trust. As long as the wife remains alive, she receives all of the income from the trust property. Upon her death, according to the will, “the trust estate would be distributed in equal shares to each of decedent’s children then living and each group of issue of a deceased child.”

The wife served as personal representative of her husband’s estate. She apparently did not retain a probate lawyer to assist her. In 1992, she filed a petition to approve the distribution of estate property according to the terms of the will. The final order approved by the probate judge only included the husband’s children as “children” entitled to inherit under the will. But as it turned out, there was language in the will that included the wife’s children, the husband’s stepchildren, as intended beneficiaries of the trust.

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A conservatorship is designed to protect the health and finances of a person who is no longer capable of acting for themselves. A conservator is someone appointed by a California probate court to oversee the disabled person’s estate or person. Once appointed, the conservator is accountable to the court, and a judge may issue additional orders to ensure the conservatorship is handled properly.

Judge Erred in Ordering Premature Division of Couple’s Community Property

Judges are not always right. In a recent case from Santa Ana, a California appeals court overruled a probate court’s order against the spouse of a man under a conservatorship. The probate judge said the spouse disobeyed an order related to the conservatorship.

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Nearly 60 million Americans receive Social Security benefits. Approximately two-thirds of these recipients are retired workers. According to Social Security, retirement benefits “represent about 39 percent of the income of the elderly.” But what happens to those benefits after the recipient dies? Can your estate continue to receive your Social Security payments?

Retirement Benefits After Death

With respect to retirement benefits, Social Security ends upon your death. Indeed, it is essential to notify Social Security of a recipient’s death as soon as possible. In many cases, a funeral director hired by the family will take care of this duty.

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The recent death of Prince Rogers Nelson sparked a great deal of interest in estate planning circles when it became known that the famous musician, commonly known by just his first name of “Prince,” apparently did not leave a last will and testament. Nelson was also unmarried and had no surviving children at the time of his death. This has led to concerns that his siblings—and perhaps individuals claiming to be his siblings—will fight over the final disposal of Nelson’s sizable estate in a Minnesota probate court.

What Happens When You Die Without a Will?

In legal terms, a person who dies without a will is said to die intestate. When this happens, the probate law of the state where the estate is opened—generally the residence of the deceased—dictates the order of inheritance. For example, under California’s intestacy law, if a person dies without a spouse, child, or surviving parent, his entire estate would be equally divided among his siblings.

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A trust refers to any agreement where a person—the settlor—transfers certain property to a trustee, who must then administer that property as directed by the trust instrument. In estate planning, a revocable living trust allows the settlor to name herself as trustee during his lifetime and a successor trustee who takes office upon the settlor’s death. The trust is “revocable” in that the settlor may remove some or all of the property from the trust while she is still alive. But once the settlor dies, the trust may become irrevocable and the successor trustee is bound by the settlor’s instructions.

Daughter Not Entitled to Trust Information Prior to Father’s Death

A trust typically names one or more beneficiaries. For example, you might create a revocable living trust naming your children as beneficiaries upon your death. Trust beneficiaries enjoy certain rights under California law. In 2012, the California Supreme Court held that when a living trust names someone other than the settlor as trustee, the beneficiaries could seek a court order demanding an accounting of the trust’s finances for the period when the trust was still revocable—i.e., during the settlor’s lifetime.

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On September 21, 2015, California Gov. Jerry Brown signed legislation authorizing the use of “Revocable Transfer on Death Deeds” as an estate planning option for residential property owners. As of this year, owners may use these instruments to bypass the normal probate process when disposing of their homes after death. Several states already permit these types of deeds, although there are concerns about the potential for abuse.

What is a Transfer-on-Death Deed?

Under the new California law, a homeowner may file a deed naming a beneficiary who will automatically inherit the property upon the owner’s death. (The deed may also name multiple beneficiaries.) This means the property will not pass through the deceased owner’s probate estate. A transfer-on-death deed may only be used for residential properties, including condominiums, parcels with four or fewer dwellings, or farms containing 40 acres or less and a single-family home.

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Something to consider when you are making an estate plan is taking stock of just how much stuff you own. While we generally discuss an estate in terms of major assets (real estate, bank accounts, brokerage portfolios, etc.) there is also quite a bit of tangible personal property or household effects included. Some personal property can be quite valuable, such as artwork or antique furniture. But much of your tangible property has primarily personal or sentimental value—think of family photographs, books, and various mementos scattered throughout your house. Upon your death, someone must take responsibility for all of these items.

Your estate plan should specify how to distribute your tangible personal property. For example, you might direct your children to divide all household effects between themselves, with your executor settling any disagreements and disposing of any unwanted items. Similarly, if you place your assets in a living trust, you may authorize your trustee to decide the best means of disposing of the contents of your house.

Failure to Clean Out House Drains Trust Assets