If your spouse passed away in California without a Trust, you may think you'll need to go through probate. However, in many cases, the surviving spouse does not need to probate the estate of their loved one to gain access to his or her assets. Instead, you may only need to file a Spousal Property Petition. A Spousal Property Petition can save a lot of time and money. Here's how to determine if you need to go to Court, and whether you'll need a Probate or simply a Spousal Property Petition:
1. Do you Need to go to Court to Transfer your Spouse's Assets?
If your spouse passed away in California and had more than $150,000 of assets titled in his or her name, you’ll most likely need to go to court in order to gain access to the asset(s). In other words, he or she died without a trust, and with assets held solely in his or her name. Accounts that are held jointly or with beneficiary listings would not count toward this $150,000 minimum.
Even if the spouse had a will, the surviving spouse will still need to go to court. If the spouse had no will, that person is said to have died "intestate" and his or her assets will pass according to the laws of intestate succession. If the assets are all community property, they will generally all go to the spouse.
2. If you need to go to Court, do you need to a Probate or a Spousal Property Petition?
Let’s first define Probate and Spousal Property Petition:
Probate: The court overseen process of transferring assets from a deceased person to his or her heirs or beneficiaries.
Spousal Property Petition: A petition submitted to the probate court of the county where the spouse or domestic partner died that essentially requests authorization to transfer assets from the deceased spouse to the living spouse (or legal domestic partner). There are some other instances in which a spousal property petition may be used.
1. If the spouse is the only beneficiary to the estate/assets:
If the spouse is the only beneficiary to the estate, you will most likely only need a spousal property petition. There are some special circumstances in which a full probate may be required, so consult an attorney who specializes in Probate for your specific situation.
A spousal property petition can only be used to transfer assets that the living spouse alone is entitled to. The living spouse may be entitled to the assets through a will or through the laws of intestate succession. The most common example of this scenario is when a spouse passes away with assets in his or her name and those assets are not separate property assets. In general, this means that all the monies held by the deceased spouse were earned during the marriage and any property held by the deceased spouse was paid for using community property funds. The estate of a person who passes away with significant separate property assets (inheritance, money earned prior to marriage, property purchased prior to marriage etc) will most likely need to go through probate. Always consult a legal professional if you have questions about the assets left by your spouse.
2. If there are other beneficiaries under the deceased spouse’s will:
If the spouse created a will which includes other beneficiaries, a probate is most likely necessary for the assets being transferred to those beneficiaries.
3. If there is no Will:
If the spouse passed away without creating a will or trust, the property will pass in accordance with laws which determine who will inherit a decedent’s property. This is called intestate succession. Any shared property (community property) between spouses will be transferred to the surviving spouse through a spousal property petition. But if the deceased spouse owned property in their own name as separate property, and the or she passed away without a will, it may be necessary to probate the separate property assets. In a situation such as this, both a spousal property petition and a probate would be necessary.
4. If there are potential legal problems with the estate:
If there is a potential litigation against the estate, a will contest is likely, or problems with creditors, the surviving spouse may elect to go through a probate process in lieu of a spousal property petition. This is because the probate process is better equipped to handle more complicated legal issues, and the surviving spouse is less likely to face liability or lawsuits that may arise should a probate not occur.
How a Spousal Property Petition Works:
First, the surviving spouse (or their attorney) files a spousal property petition with the Superior Court in the county where the decedent lived. The petition lists the facts of the case and the community property owned by the decedent. Assets that are owned in joint tenancy will not be included on the petition.
The spousal property petition requests that the court confirm that the surviving spouse is entitled to their 50% share of the community property, pursuant to California law. The petition also asks the court to grant the decedent’s 50% share of the community property to the surviving spouse. Essentially, the spousal property petition asks the court to give 100% of the community property to the surviving spouse.
After the petition is filed, the court will set a hearing date. Notice of the hearing is sent to everyone mentioned in the will (if one exists) and to all of the decedent’s heirs. In some instances, the court may pre-approve the Spousal Property Petition and thus avoid the need for the hearing.
Once the order is approved and signed by the judge, it needs to be recorded with the County Recorder in every county where real property is located. This will update the county records to list the surviving spouse as the new owner of the property. Copies of the order can also be given to financial institutions (such as banks) and brokerages to show proof of ownership over the decedent’s assets.
What happens if you do not file a spousal property petition?
If a surviving spouse does not file the petition, the deceased spouse’s name will remain on the assets and this may lead to complicated title issues which could preclude sales or transfers of the assets. Real estate, for example, cannot be sold or refinanced until the title is cleared.
Do you need an Attorney to file a Spousal Property Petition?
It's always best to consult an attorney. Working with an attorney who specializes in probate law helps to protect the petitioner from liability. An attorney can also provide guidance, help avoid potential litigation, and ensure that the process goes as smoothly and quickly as possible.
Spousal Property Petitions can be complicated. Always consult an attorney regarding your specific situation.