If a non-domiciliary decedent who owns real estate in California dies, administration of the deceased non-domiciliary deceased’s real estate in California will be governed by California law. How the nonresident’s California real estate is owned (titled) largely determines whether the nonresident’s California real estate is subject to probate in California.
If the property located in California was titled a joint tenancy with survivors’ rights, a simple affidavit of death of the joint tenant with an accompanying certified death certificate will be recorded with the County Recorder’s Office where the property is located and the associated county assessor’s documents submitted at the same time. This removes the deceased common tenant’s name from the property, with the surviving common tenant owning the deceased’s shares, and notifies the appraiser that the owner is deceased and identifies the new owner.
If the property was titled as a trust in the name of the deceased as trustee, the successor trustee may rename the interest in the successor trustee’s name by taking an affidavit from the successor trustee, attaching a certified death certificate, and filing assessor documents. The property becomes part of the testator’s trusteeship and avoids probate proceedings.
If the property is individually titled in the deceased’s name, the analysis is more complicated. If the total value of the non-resident’s real estate in California is estimated (by a probate appraiser) to be greater than the dollar (value) threshold at which probate is required, then an ancillary probate is required. Currently, deceased dying on or after April 1, 2022 whose estate is estimated to have a gross value of at least $184,500 are subject to probate proceedings if the estate passes to a person other than the surviving spouse or civil partner of the deceased.
Assets passed to the surviving spouse or civil partner of a decedent are not subject to probate testing, regardless of whether the decedent was a California resident. Instead, a so-called Spousal Property Petition is used to transfer property to the surviving spouse with a single court hearing without an estate.
When the estate of a non-resident decedent is involved in probate proceedings in the decedent’s state of residence (home state), the California personal representative in the ancillary estate must often cooperate with the personal representative in the decedent’s state of residence (home state). Usually it’s the same person.
A secondary estate in California often results in the net estate being distributed to the personal representative of the testator’s state of residence. It then becomes part of the estate of the state of residence (home state) of the deceased.
If the nonresident owned real estate in California that was (collectively) valued below the probate threshold by a California probate officer, an alternative approach may be available. Typically, the alternative is for the person claiming the property (under a testator’s will or under the California laws of statutory succession) to file what is known as an “application to determine the succession of real estate.” The consent of the personal representative of the deceased’s country of residence (home country) is not required; all that is required is a notification to the personal domiciliary representative. If successful, the application results in an unadministrated transfer of ownership to the applicant.
If the appraised value of the property is small, i.e. less than $61,500 (for the deceased’s death after April 1, 2022), an affidavit with an attached certified death certificate will be used. The affidavit and attachments will be filed with the high court for the county where the property is located and a certified copy of the affidavit will be filed with the county registry office along with the forms for the appraisers.
Nonresident decedents would do well to get their affairs in order to both avoid probate proceedings and distribute assets as intended when their California property is at stake. Typically, a trust is the preferred approach to estate planning. A trust does not have to be incorporated or administered in California in order to own assets in California or other sister states.
The foregoing discussion is not legal advice. Dennis A. Fordham, Attorney at Law, is a prosecution-licensed specialist in estate planning, probate and trust law. His office is at 870 S. Main St., Lakeport, California. He can be reached at [email protected] and 707-263-3235.