Posts tagged California Probate Code Section 10800
What are the advantages of using a revocable living trust in California?

Unlike other states in the US, the probate process in California (which is required if one dies with only a Will or without any estate planning documents at all), is (a) time consuming and (b) expensive. As a result most people in California should consider utilizing a revocable living trust as the primary estate planning vehicle as it minimizes the risk of encountering the probate process.

Probate proceedings in California require notices and hearings, which take time to complete. In addition, a number of ancillary issues might arise during the public probate process that requires attention, such as dealing with creditor claims. If that weren't enough, the fees incurred during the probate process are usually much higher than the fees associated with administering a revocable living trust with comparable assets. California Probate Code Section 10800 describes how the fee for the Executor of an estate is calculated:

a) Subject to the provisions of this part, for ordinary services the personal representative shall receive compensation based on the value of the estate accounted for by the personal representative, as follows:

(1) Four percent on the first one hundred thousand dollars ($100,000).

(2) Three percent on the next one hundred thousand dollars ($100,000).

(3) Two percent on the next eight hundred thousand dollars ($800,000).

(4) One percent on the next nine million dollars ($9,000,000).

(5) One-half of one percent on the next fifteen million dollars ($15,000,000).

(6) For all amounts above twenty-five million dollars ($25,000,000), a reasonable amount to be determined by the court.

(b) For the purposes of this section, the value of the estate accounted for by the personal representative is the total amount of the appraisal value of property in the inventory, plus gains over the appraisal value on sales, plus receipts, less losses from the appraisal value on sales, without reference to encumbrances or other obligations on estate property.

The lawyer handling the probate for an Executor or Administrator is also entitled to the same statutory amount.

The other major benefit is that a revocable living trust helps you avoid a conservatorship if you become incapacitated. This is because your trust can allow for a successor Trustee to step in and take control of trust assets to manage and use them for your benefit. This avoids the need to have a court proceeding to appoint a conservator to manage your affairs (which, by the way, is expensive and can be highly inconvenient for your family).

Although a revocable living trust has great advantages, there are a few disadvantages. Despite, the disadvantages, however, the benefits often far outweigh the downsides.