If a person dies and does not have a will, has a will but does not have a living trust, or has assets totaling more than $150,000 held outside of the trust, his or her estate must be probated. You might be wondering, “What is probate and why is everyone trying so hard to avoid it?” The short answer is that probate is a court-supervised procedure for collecting a deceased person’s assets, paying debts and taxes, and distributing the property to the person’s beneficiaries (either according to the instructions the person set forth in his or her will or as determined by state law if the person died without a will). The probate process usually takes twelve to eighteen months to complete, although it may take longer in complicated cases.

Probate is not a tax. When people refer to the high costs of probate, they are usually referring to the court and administrative costs and the attorney’s and personal representative’s fees. In California, the attorney’s and personal representative’s fees are calculated as a percentage of the gross (not net) value of the assets in the estate, and are set forth in California Probate Code §10800 and §10810. The fee schedule is $4,000 (or 4%) of the first $100,000, $3,000 (or 3%) of the next $100,000, two percent (2%) of any amount between $200,000 and $1 million, one percent (1%) of any amount between $1 million and $10 million and so on.