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Understanding the legal steps to take following the passing of a surviving parent.
Losing a loved one is never easy. You deserve the ability to mourn their passing without the burden of legal responsibilities hanging over your head. Unfortunately, even while you are grieving your loved one, there are practical and legal steps that should be taken. While necessary, administering an estate is no simple task. By educating yourself on this subject, you will be able to complete these necessary legal formalities without depriving yourself and your family of the proper time to mourn.
Working with a skilled estate attorney provides you with the legal oversight needed to effectively manage your parents’ affairs. By completing these steps correctly, you will be able to administer and transfer all property and assets in a smooth and efficient manner.
Obtaining a death certificate is the first step in administering your parents’ estate. In California, the mortuary or funeral home will ask you how many death certificates you would like and then order death certificates. The timeframe for receipt of the death certificates varies from county to county. Currently in Monterey County, it takes about 2 weeks for the county to process the death certificates.
If alternative arrangements were made and you did not get death certificates from a mortuary or funeral home, the estate attorney is able to order them directly from the county.
I am often asked how many death certificates should be ordered. In general, for a family where there are only one or two pieces of real estate and a modest number of financial accounts, I recommend between 5-7 death certificates. If there are very few assets, then fewer death certificates are needed. If there are significant assets (especially real estate holdings) then correspondingly more death certificates should be ordered because they will be needed. Again, if it is determined later that more are needed, then those can be ordered by the estate attorney.
I am often asked if the heirs should wait until they have the death certificates before they come in to speak with me. The answer is no. As soon as you feel emotionally prepared to discuss the next steps, it is never too soon to speak with an estate attorney about proceeding with the administration of an estate. The reason is because there are many notices and documents that can be prepared by the estate attorney while we are awaiting receipt of the death certificates. In fact, the notice period of the administration of a trust can begin during that waiting period which helps move the administration along for the family in an efficient manner.
Once you have received the original death certificates, the estate attorney will use one death certificate per county where real estate is held. This ensures that the successor trustee/co-trustees are put on the title as the currently acting trustee/co-trustees, which allows the successor in interest to oversee all aspects of the house moving forward. The document the estate attorney will prepare for each county in which real estate is held is called an “Affidavit of Death of Settlor/Trustee
From a practical perspective, the successor trustee should consider changing the locks immediately on any vacant real estate while the estate is being administered. Unfortunately, there are those who scan the obituaries looking for opportunities to burglarize vacant homes so due to the potential of targeting for theft we recommend making sure the real estate and the contents therein are secure as quickly as possible.
Once a person passes away, their social security number (SSN) is not permitted to be used. In fact, the mortuary or funeral home will usually submit paperwork to the Social Security Administration office to advise them of the death. They do this without conferring with the family in most instances. Since the SSN is inactive, any banking that was done under that SSN will be halted until a new taxpayer identification number can be obtained by the IRS.
The estate attorney will routinely obtain for an estate the new taxpayer identification number or EIN from the IRS for the Trust or estate. This is a number that banks and financial institutions will require, in addition to a new Certificate of Trust. With these two items, you will be able to add the designated individuals to the Trust bank accounts and financial accounts as “successor co-trustees.”
Once a surviving parent has passed, distributing the estate to the beneficiaries is among the most important legal tasks to complete. I am often asked how long this takes. In California there are two waiting time periods to allow heirs, beneficiaries, creditors and any other party with a potential interest in the estate to come forward. It is crucial that the successor trustee works with an estate attorney to make sure that the laws of California are followed in the administration of estate because not following the law can result in personal liability to the successor trustee.
First, under California law, you must have a notice of trust administration prepared and served. This is a document required to be sent to all beneficiaries. This notice can be sent directly after a loved one passes away. To prepare the notice, the estate attorney will need the estate planning documents and family information about the decedent the date that the notice is sent, all beneficiaries have 120 days to contest the trust. They also have a right to a copy of the trust. Providing a copy of the trust from the beginning can shorten the time they have to contest the trust.
Assuming that there are no issues (which are rare), then those who were properly noticed are barred from contesting the terms of the trust following the 120-day period.
The next step is for the successor trustee to prepare an accounting of the estate and send it to the beneficiaries. The accounting provides a list of all assets owned by the trust and the values, a list of all debts and expenses of the trust, and the proposed distributions to be made to the beneficiaries. Under California law, each beneficiary has 180 days to review the trust and object. Once the 180-day period passes, they beneficiaries are barred from objection and the successor trustee can move forward with distributing the assets to the beneficiaries. To shorten the 180-waiting period, often an estate attorney will recommend sending the accounting along with a waiver. If each beneficiary returns the signed waiver then the trust can be distributed prior to the 180 accounting review period.
As all of these legal proceedings are underway, the successor trustee can do what is needed to maintain the estate assets and prepare to make the distributions. This includes making arrangements for the sale of real estate if appropriate. It is recommended that the successor trustee keep records of the assets along with any expenses during the administration process so that they can use these records when preparing the accounting.
It is common for our office to get lots of questions from successor trustees during the administration process related to specific assets or certain challenges that they experience. The relationship with your estate attorney and the comfort you have in calling to ask questions as you navigate through the administration process is particularly important. I encourage you to pick an estate attorney who is responsive to you and is focused on helping you through the process in an efficient legally sound manner.
Administering a parent or loved one’s estate is a complex legal process. With the guidance that a legal professional can provide, you will be able to complete the necessary actions in a legally sound and efficient manner. When it comes to estate planning, avoiding legal mistakes is crucial. Making educated decisions about a productive plan of action will allow you and your family to avoid any legal challenges that may arise along the way. Are you ready to get all of your estate planning questions answered? Contact Hudson Martin PC today for more information!
Note: The Information Provided On This Website Is For General Informational Purposes Only And Is Not Intended To Be Legal Advice. The Content Of This Website May Not Reflect Current Legal Developments And Is Subject To Change Without Notice.