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WHEN A PERSON DIES OF AIDS family and friends are left to cope
with many details. During this difficult period the process of
settling the affairs of the deceased can be ovenwhelming. This
brochure is designed to prepare the survivors for some of the
administrative procedures they can expect to encounter. A glossary of
legal terms used in this brochure is provided below to help you
understand the process of settling a small estate.
DECEDENT
The person who has died, whether or not he or she left a will. Also called the deceased.
ESTATE
Property and belongings held by the decedent at the time of death.
INTESTATE
A person is said to have died intestate when he or she dies without a valid will. In this case, state laws of "intestate succession" determine who inherits decedent's property.
WILL.
Formal document representing the instructions of the deceased for the distribution of the estate.
PROBATE
The process of transferring the possessions/assets of the deceased to those persons who "inherit" them. Some of the decedent's assets automatically transfer to a named individual (e.g. joint tenancy) and do not need to pass through the probate procedure.
ESTATE ADMINISTRATION
Formal procedures for probating the estate. Through probate the debts of the decedent are paid and the remaining assets are distributed according to the will or intestate law.
SUMMARY ADMINISTRATION
An alternative way to transfer property outside formal probate procedures when an estate is less than $60,000.
EXECUTOR
Person named in the will to manage the administration of the estate. If there is no will, the probate court will appoint a person, called the administrator. An administrator and an executor serve the same function. The duly appointed executor or administrator has had letters of administration - or letters testamentary issued to them.
LETTERS
Letters of administration or testamentary are formal documents issued by the court. Letters of administration are issued when the court appoints an administrator. Letters testamentary are issued when the court appoints an executor. The letters are the executor's or administrator's "license" to act for the estate. Letters are not issued when summary administration is used.
AFFIDAVIT
Written/printed declaration or statement of facts made voluntarily under oath.
There are certain agencies which should be contacted directly after
the death of a loved one. Direct contact allows certain assets, such
as life insurance policies or survivor's benefits from social
security, to be transferred to the proper beneficiaries more quickly
than if the property were to be transferred in a probate proceeding.
Most agencies can be contacted after the death certificates have been
received from the coroner. The following is a list of agencies which
can or must be contacted directly by the executor or administrator.
In addition, do not overlook the possibility that the decedent may
have had benefits payable to survivors through work. Contact the
decedent's employer directly.
Funeral Homes
If the deceased arranged for burial instructions prior to death,
contact that funeral home or cremation society. Burial instructions
are usually located in the will. The person authorized to carry out
these instructions will be named either in the will or the durable
power of attorney for health care.
For persons who are unmarried or in a same sex relationship, and who
wish their surviving lover to carry out their burial instructions. it
is wise to make these arrangements in advance. If there are no burial
instructions, the next of kin is considered responsible for the
arrangements.
Obtaining Death Certificates From The Coroner
The first step in the probate process involves obtaining copies of
the death certificate from the coroner. These are usually provided by
the funeral home or cremation society. In some instances, the coroner
also may have personal belongings of the deceased including cash,
copies of the will, documents referring to bank accounts, keys,
etc.
If the estate is to be probated the coroner must be presented with
identification and either a certified copy of letters testamentary or
letters of administration before the personal effects will be
released to you. If only a small estate is involved and is not going
through probate, the claimant must either present identification
indicating that he or she is the next of kin or evidence that he or
she is the legal claimant (via the will)-with a completed affidavit
for collection of personal property. See description of affidavit in
Summary Administration section of this brochure.
You may need to obtain as many as ten to fifteen copies of the death
certificate. Every financial institution where the decedent kept
money or assets will need an original copy of the death certificate.
Life insurance companies also require a copy. In San Francisco you
may have to wait several weeks before you can obtain copies of the
death certificate. If the cause of death is uncertain you can expect
to wait longer.
Post Office
Notify the post office that you would like the decedent's mail
forwarded to your address. This will make it easier to determine what
bills the decedent may have owed at the time of death.
Social Security Administration
The Social Security Office must be notified of death if the decedent
was receiving social security benefits. Also, any check(s) received
during the month the decedent died must be returned.
If the decedent was entitled to Social Security, there will be a
$255.00 lump sum death benefit. The death benefit can only be
collected by a surviving spouse or surviving children under the age
of 18. Children up to 22 years of age may also collect "survivor's
benefits" if they are enrolled full time in college. The death
benefit will NOT be paid automatically. Contact your nearest Social
Security Office to apply. Application must be made within two years
of the death. A copy of the death certificate will be required. The
lump sum death benefit does not apply to Supplemental Security Income
(SSI).
Director Of Health Services
The Director of the State Health Services must be notified within 90
days of death if the decedent was receiving benefits under MediCal.
See "Health Services Department" listed under state government in
your telephone book.
Veteran's Administration
Benefits are available through the Veteran's Administration to help
pay the burial expenses for deceased veterans. In addition, many
veterans have life insurance policies through the Veteran's
Administration. Contact.the nearest Veteran's Administration
Office.
Life Insurance Companies
Contact the life insurance company directly if the decedent left a
life insurance policy with a named beneficiary other than the estate.
The proceeds can usually be quickly obtained by the beneficiary once
the company is sent a completed "form of death" along with a copy of
the death certificate and the original policy of insurance. Obtain
the "form of death" directly from the insurer.
It is important to note that if there is not a named beneficiary for
the policy, the proceeds are considered part of the decedent's
probate estate. Therefore, probate may be required if the policy
causes the gross value of the estate to exceed $60,000. Note that
with some policies, if there is no named beneficiary, the proceeds go
to persons named by the insurance carrier, such as the surviving
spouse or decedent's parents.
Decedent's Employer
You should contact the decedent's employer to determine whether the
decedent had participated in any benefit plans. See discussion of
retirement and death benefits under heading "Direct Transfer of
Property Outside Probate" in this brochure
Taxes Due At Death
The IRS holds the duly appointed executor or administrator
responsible for the proper and timely filing and payment of taxes.
Generally, there are three types of federal taxes due at death.
First, a federal estate tax is imposed on large estates over
$600,000. Second, a final Federal income tax return (Form 1040) must
be filed which reports any income earned by the decedent during the
part of the year in which he or she was alive. The third tax involved
is an income tax for income accrued by the estate from date of death
to date of distribution (use Form 1041).
_ See a tax preparer to determine if these tax returns are due. Call
your local SALSA office for a referral.
Generally, the State of California does not levy an estate tax at
death. The State may require the filing of a state income tax return
for the decedent (Form 540) for income
. received before date of death. The State also may require an income
tax return for the estate (Form 541 ) for income accrued by the
estate from date of death to the end of the Taxable year. You should
contact the federal and state tax agencies to determine the correct
forms and filing procedures. You should also consider consulting a
tax attorney. Again, call your local SALSA office for a referral.
Once the independent agencies have been contacted, the nextstep is to
determine the best method of transferring the decedent's property.
Locate what type of assets were owned by the decedent at the time of
death. Do not overlook the possibility that the decedent kept
information about assets somewhere other than in his or her home
(such as a safe-deposit box). Also, if a lawyer drafted decedent s
will, he or she may have a copy of it.
UNDERSTANDING WILLS AND PROBATE
The will gives you directions for carrying out the last wishes of the
deceased. If the decedent died intestate (without a will), California
law defines the persons who are to receive the decedent's property.
Basically, the decedent's property will go to the next of kin. One of
the reasons for making a will' even if you have only a few
belongings is to ensure that your property will be distributed
according to your wishes, particularly if you want your property to
go to someone other than your family. When a person in a same sex
relationship dies without a will, the surviving lover may have to
rely on the "good intentions" of the decedent's family to collect any
of the decedent's belongings. (For more information, see SALSA
brochure entitled "Making Your Will".)
Determining the type of assets owned by the decedent will help guide
you through the process of estate administration. If the property in
the estate that does not pass directly to a named individual is
greater than $60,000, probate is generally required (whether or not
there is a will). Because of the time and expense involved in a
probate procedure, you may want to avoid probate if the decedent did
not leave many assets. The following sections will discuss 1) the
types of property that pass directly to the beneficiaries without
going through formal probate procedures and 2) summary administration
of the estate.
FORMAL PROBATE PROCEDURES
If the gross value of the decedent's estate is more than $60,000,
probate will be required and an attorney should be consulted. Formal
probate requires an appearance in superior court, often referred to
as the "probate court". Documents must be filed with the court, and
the person requesting authority to administer the estate (the
executor or administrator) is required to notify persons who may have
an interest in the estate, including creditors. Formal probate should
be initiated as soon as possible after the death of the decedent.
However, the process usually takes at least seven months:
Time and money can be saved if the decedent's property can be
transferred by means other than a formal probate procedure. Several
types of property which can be transferred outside of probate are
discussed below.
DIRECT TRANSFER OF PROPERTY OUTSIDE
PROBATE
Certain types of assets may be transferred directly to the
beneficiaries without going through a formal probate procedure even
if the value of the assets are over $60,000. Also, the property can
be directly transferred even if there is a formal probate action. The
following is a list of assets which may be transferred directly.
Life Insurance Policy With Named Beneficiary Other Than
Estate
The preceding section discusses how to collect the policy directly
from the life insurance company.
Community Property Which Passes Outright To The Surviving
Spouse
Because California is considered a "community property" state, a
surviving spouse is entitled to receive community property.
Community real property can be claimed via a simple affidavit.
Otherwise, the surviving spouse can obtain a Spousal Property Order
from superior court.
Joint Tenancy Property
Property held in joint tenancy passes directly to the survivor at the
moment of death. You need only complete an Affidavit of Death of
Joint Tenant. This document should be filed with the county
recorder.
For purposes of the Department of Motor Vehicles, an automobile
registered in the name of two persons joined by an "or" is considered
to be held in joint tenancy (e.g. "John Smith or Joe Jackson"). Fill
out a form which can be obtained directly from the DMV to transfer
title to yourself.
Bank accounts held in joint tenancy may be transferred by writing a
check for the balance and presenting a certified copy of the death
certificate to the bank. When a money market account is held in joint
tenancy, contact the transfer agent to change ownership.
Money In Payable On Death Bank Accounts
Money held in payable on death accounts will be released to the
beneficiary when a copy of the death certificate is presented along
with a savings account passbook and/or a check drawn for the
balance.
Retirement & Death Benefits
Retirement and death benefits should be collected directly from the
company carrying the plan. Individual Retirement Accounts (IRA's) can
also be collected directly from the institution handling the account
unless the benefit is payable to the decedent's estate. Because death
benefits are usually obtained through an employer, contact the
decedent's employer to determine whether the decedent had
participated in any benefit plans. Often death benefits go to next of
kin if there is no named beneficiary.
Property Held In Inter Vivos Trust
Property held in inter vivos trust is transferred directly to the
beneficiary of the trust without going through probate. Inter vivos
trusts have usually been created for the express purpose of avoiding
probate.
SUMMARY ADMINISTRATION
When the gross value of the decedent's estate is less than $60,000,
the estate may be distributed without going through probate. However,
there may be situations where even "simple" estates should go through
probate. For example, if the decedent's debts are greater than his or
her assets, probate may be a better choice because all debts are
discharged under a probate proceeding.
Under the California Probate Code there are three sections which
allow for the collection or transfer of property, referred to as
"summary administration", without a filing for formal probate. The
next section will specifically address how to obtain the decedent's
property using these sections of the Probate Code.
l) Section 13100: Collection or Transfer of Personal
Property
Unlike formal probate, the transfer of personal property under
Section 13100 does not require a court appearance. In fact, Section
13100 allows the beneficiaries to obtain the property from
institutions (such as banks) by presenting an affidavit along with a
certified death certificate and a description of the property.
Section 13100 can only be used to transfer personal property such as
money; furniture, or automobiles. Real estate cannot be transferred
using this section. However, real estate is considered when
calculating whether the gross value of the estate is less than
$60,000. For example, if the decedent owned real estate in California
worth $9,000 and personal property worth $58,000, Section 13100 could
not be used because the gross value of the estate is $67,000.
Property which is not otherwise required to go through probate is not
included in determining the gross value of the decedent's estate. To
determine the gross value of the decedent's estate do NOT include the
following property:
Therefore, if the decedent had a $75,000 life insurance policy
with a named beneficiary, Section 13100 could still be used as long
as the rest of the decedent's assets are less than $60,000. If you
have questions about whether or not to include certain property in
determining the gross value of the decedent's estate, you should talk
with an attorney. Call your local SALSA office for a referral.
- Note: Under. California law, assets, passing through probate. are
obligated to be used to pay the decedent's debts. As a general rule,
persons collecting assets using Section 13100 will be liable for any
funeral and "last illness" expenses and unsecured debts to the extent
of the value of the property they have received from the estate. If
property is going to be transferred using Section 13100, all of the
decedent's debts should be paid.
Who Can Use Section 13100?
Section 13100 can be used whether or not the decedent left a will If
you are a beneficiary under a will you can use Section 13100 to
obtain the property that has been left to you. If the decedent did
not bequeath specific property to beneficiaries, all of the
beneficiaries under the will must sign the affidavit before the
property will be transferred. For example, if the decedent left "all
personal property to my children", all of the children must sign the
Section 13100 affidavit.
In addition, property can be obtained by persons acting on "behalf
of" the beneficiaries under a will. This would include executors
named in the will or guardians of minor children.
If the decedent did not leave a will, only certain people are
entitled to obtain the decedent's property under California Probate
Section 13100. The laws of intestate succession govern who is
entitled to the property. Under California law, who is entitled to
the property depends on whether the decedent was married. If the
decedent was not married the "next of kin" are entitled to the
property depending on their relationship to the decedent. Note that
several people may be required to sign the affidavit if the decedent
died intestate. (Note: the same persons eligible to use Section 13100
are also eligible to use Section 13200.)
What is the Affidavit?
California Probate Code Section 13100 sets forth precisely what the
affidavit must contain. But, while all affidavits contain the same
language, different banks and institutions have different formats for
this language which they prefer to use. Always check with the
institution beforehand and get their version of the form.
When Administrative Procedures Are Pending
_ A Section 13100 collection or transfer of personal property may be
effected even though a probate has been conducted or is currently
pending provided the executor/administrator gives his or her written
consent. (This is also true for Section 13200.)
At Least 40 Days Have Elapsed
Unlike a formal probate action (which can be initiated immediately
after death), property cannot be transferred using Section 13100 of
the California Probate Code until 40 days have elapsed from the time
of death. The 40 day wait allows any creditors who may have a claim
against the decedent's estate to submit any bills (which should be
paid before the beneficiaries receive any money).
Proof of Identity
The person signing the affidavit must be able to provide reasonable
proof of his or her identity before the property may be transferred.
Although Section 13100 does not require the affidavit to be signed by
a notary public, many institutions will want the affidavit notarized.
If the institution does not require the signature of a notary, proof
of identity can be furnished by signing the affidavit in the presence
of the holder of the property and presenting proof of identity such
as a driver's license, or if you are personally known to the person
or institution holding the property.
Death Certificate
A certified copy of the death certificate must be attached to the
Section 13100 affidavit.
Presenting the Affidavit
Once you have filled out the affidavit you are ready to begin
transferring the property. Make sure you have described the property
correctly. For example, if you are attempting to collect money
located in a savings or checking account, the affidavit must contain
the decedent's account number. it is also wise to include the
decedent's social security number. You should also include the
estimated balance of the account. Finally, many institutions will
also want additional proof of the property such as the decedent's
passbook. Don't forget the certified copy of the death certificate
and proof of your identity.
If all of the requirements of California Code Section 13100 have been
met, the holder of the decedent's property is required to transfer
the property. If you want to transfer title to the decedent's
automobile, visit your nearest DMV office. The Department of Motor
Vehicles has their own version of the Section 13100 affidavit.
Although the holder of the property is required by law to release the
property, do not be surprised if the property is not immediately
released. The institution is simply insuring that they do not release
property to the wrong person. They may have to consult with their
legal department before they will release the decedent's assets to
you. If the institution continues to refuse to release the property,
you may wish to visit your local law library and make a copy of
Section 13100. An attorney may need to be consulted if the
person/institution holding the property still will not release the
property. Call your local SALSA office for a referral.
2) Section 13200: Collection or Transfer of Real Property
Like Section 13100, Section 13200 does not require a court
appearance. However, there are some major differences between these
two sections of the Probate Code. First, Section 13200 allows for the
collection or transfer of California real property only The total
gross value of the decedent's California real property must not
exceed $10,000. The value of decedent's personal property has no
bearing on calculating the $10,000 maximum. Also, real property held
in joint tenancy and real property located outside Ca!ifornia are not
included.
Second, at least six months must have passed since the date of
decedent's death.
Third, an "Affidavit of RealProperty of Small Value"must be filed
with the superior court of the county where decedent lived along with
a mandatory inventory and appraisal of the decedent's California
realty, a copy of the death certificate, and a mandatory notary
public's certificate of acknowledgement identifying the person
executing the affidavit. Unlike Section 13100, the affidavit and
attachments are not presented to the holder of the property. Once the
affidavit and attachments are filed with superior court and they
comply with all the requirements, the court clerk will return a
certified copy to the person claiming title to be recorded in the
proper county.
Remember, under California law, the assets you are taking are
obligated to be used to pay the decedent's debts.
3) Section 13150: Court Order Determining Succession to
Property
Title to decedent's personal and real property may be cleared bye
court order under Section 13150 when the total gross value of both
real and personal property in California does not exceed $60,000.
Section 13150 is an effective "non probate alternative" when the
value of decedent's real property is over $10,000 (so that Section
13200 cannot be used) and yet the total size of the estate is
relatively small (up to $60,000) making a formal probate
unnecessary.
Although a court proceeding is required when using Section 13150, it
is not nearly as costly and lengthy as a formal probate proceeding. A
"Petition to Determine Succession to Property" is filed in superior
court by the person entitled to the property along with a copy of the
will (if one exists). You must include an inventory and appraisal of
all property (real and personal) to be considered in determining the
$60,000 limitation.
Like Section 13100, you need only wait 40 days from the date of death
before you can begin a Section 13150 proceeding. This is true even
though it includes real property, which makes it a good alternative
to the six month wait required by Section 13200.
Remember that this brochure has been designed to give you a broad
overview of the administrative procedures that you may encounter
while trying to settle the affairs of a loved one who has died. This
brochure is not meant to take the place of consulting with an
attorney or with the various agencies mentioned.
Do not overlook your own needs during this difficult and confusing
period. There are support agencies which can help you. Social workers
can provide tremendous support and help, especially for things such
as filing for survivor's benefits. Look for support agencies and
organizations in your area.