One common question we get is how much does it cost to probate an estate? In the state of California, the answer depends on numerous factors, including the estate’s size or value and the type of assets going through probate. Thus, probate referees are used to appraise the estate and determine the fair market value of the assets involved in the probate action. When determining the fair market value, mortgages and other debts are also considered.
Suppose someone in California dies with $150,000 or more in assets. These assets must be assigned to heirs to avoid probate fees. This is done in multiple ways, such as through a surviving spouse, beneficiary designation, or estate plan that includes a living trust.
If there is no plan in place for distributing the assets, they must go through the probate proceedings. In essence, probate cost in a particular case is generally related to the assets’ value. Common assets that go through the probate process are real property and bank accounts. The probate court judge’s role assures that the deceased person’s debts are paid and that the proper beneficiaries receive any remaining assets.
How Much Will Probate Cost You?
Simply put, the administration of an estate should not cost you anything. Although fees are associated with the probate process, if it becomes necessary to pay anything out of pocket upfront, you will be reimbursed later on from the estate’s assets. You can review the different types of fees outlined below:
There are dozens of potential court costs associated with a probate case, beginning with the initial filing fee. They are generally between $435 to $650 for each separate court fee. Circumstances calling for additional court costs include a complicated estate and disputes between parties.
Attorney and Personal Representative Fees
The personal representative is an executor, executrix, or administrator. This individual has the duty of guiding the probate process for the estate. The job can be time-consuming and complicated.
The probate attorney provides expertise and represents the personal representative and the estate to the probate court. Compensation for the personal representative is a percentage of the estate’s value.
California Probate Code Section 10810 sets forth the formula for determining attorney fees in a probate matter. If extraordinary services are provided, such as the case is complicated or involves novel issues, the probate court can increase the fees by state law. However, in most cases, the attorney fees are as follows:
- 4% of the first $100,000 of the gross estate,
- 3% of the next $100,000,
- 2% of the next $800,000,
- 1% of the next $9,000,000,
- 1/2% percent of the next $15,000,000.
If the estate is larger than $25,000,000, the probate court will determine the fee for the amount over $25,000,000. A personal representative is entitled to be paid the same amount as their lawyers.
However, the personal representative needs to understand that the fees are typically treated as wages for income tax purposes. Suppose more than one person is serving as personal representative. In that case, the fees paid will not be doubled but divided among them.
Thus, it is vital to seek legal advice regarding how to avoid or minimize income taxes. You should note that the statutory fees paid to the probate attorney and the personal representative are produced from the estate assets upon court approval at the close of the probate.
Appraisal and Business Valuation Fees
These types of fees are necessary to determine the date-of-death values of the assets. These can include personal property, bank accounts, real property, and business interests. The cost of appraisal fees is between a few hundred dollars to several thousand dollars for personal property such as artwork, cars, boats, antiques, jewelry, etc. Business valuation fees come to a few thousand dollars.
Probate costs also involve accounting fees. The amount varies and depends upon such variables as types of assets owned and overall estate value. A larger estate with uncomplicated assets may not cost as much as a small estate with 30 different stocks and bonds. Accounting fees will sometimes include the preparation and filing of federal and state estate tax returns.
Other fees under the “miscellaneous” column may include:
- The cost of storing and insuring personal property.
- The cost of moving personal property.
- Shipping costs for personal property.
- The cost of postage.
Contact The Legacy Lawyers About the Cost of Probate in California
If you have been appointed as a personal representative, you are responsible for completing several tasks as part of probate administration with little room for error.
At The Legacy Lawyers, we have worked with hundreds of people in your situation. We can minimize your stress, reduce exposure to personal liability and guide you through an orderly probate process. Our team is dedicated to your peace of mind. If you have a loved one who passed away and was located in California, call to schedule your no-cost consultation: (800) 840-1998.