As this blog previously addressed, for most families, a basic California estate plan does not have to be complicated. In most cases, a basic will or trust is sufficient to provide for the distribution of property after death.
In addition, some assets can be transferred to loved ones upon death without the necessity of a will or trust and without the need to go through probate. These non-probate assets include bank accounts, retirement accounts, life insurance proceeds and other assets in which a beneficiary is named in the account document or insurance policy.
Other assets, like cars, can be transferred with a simple “payable on death” form. Until recently, there was no simple way to transfer the family home upon the homeowner’s death.
Now, under a new bill that was recently signed into law by Governor Brown, real estate can also be transferred on death with a simplified procedure. Under the new law, AB 139, a homeowner can prepare a Transfer on Death deed or TOD deed, which will effectively transfer title to the house upon the homeowner’s death, without the need to commence a probate proceeding.
The TOD deed must be signed, acknowledged and recorded by the homeowner. It can be revoked at any time before the homeowner’s death. AB 139 will become effective on January 1, 2016.
Avoiding probate is always one of the main goals of estate planning in California. The probate process in this state is expensive, time-consuming and complex. AB 139 should help many California residents avoid probate, which in turn will make more of their assets available for distribution to loved ones. Individuals with estate planning questions should seek guidance about the options available to him or her.
Source: Glendale News-Press, “Gov. Brown signs bill to make home transfers easier after death,” Mark Kellam, Sept. 21, 2015
