California Estate Planning
Regardless of where you live, you should have several basic estate planning documents in place: a will, a durable power of attorney for finances, and a medical directive. And if you live in California, a prosperous state with sky-high real estate values in its urban areas, it's an especially good idea to also think about planning to avoid probate after your death.
California has an unusual system of compensating probate lawyers. Unlike most states, California law makes it standard procedure for probate lawyers to charge, as their fee, a percentage of the gross value of the assets that go through probate. (These assets are collectively known as the "probate estate.") The state's probate code (Cal. Probate Code §§ 10810, 10811) sets out the percentages:
- 4% of the first $100,000 of the gross value of the probate estate
- 3% of the next $100,000
- 2% of the next $800,000
- 1% of the next $9 million
- .5% of the next $15 million
Lawyers aren't required to charge a percentage fee, but most of them do, because it usually results in a nice fee for not a lot of work. For example, if you leave a $200,000 gross estate, the fee is $7,000--probably just for some fairly simple paperwork. And these fees are for ordinary work. A lawyer who has unusual work can ask the court to approve a higher fee.
The articles below cover the basics of probate-avoidance planning, and other aspects of estate planning in California.