You may have heard that Probate Court in California costs a bundle, but is it really that much? The short answer is: probably.
Under California Law (CA Probate Code §§10800-10810 to be exact) the compensation paid to the estate representative(s) and their attorney(s), statutory compensation is calculated as follows:
4% of the first $100,000
3% of the next $100,000
2% of the next $800,000
1% of the next $9,000,000
0.05% of the next $15,000,000
For all amounts above $25,000,000 a reasonable sum determined by the court.
In other words, a $750,000 estate translates into roughly $36,000 of legal fees (about $18,000 for the estate representative and $18,000 for the law firm). And that does NOT include court filing fees, and other costs such as court-mandated appraisals, publication of legal notices, etc.
And many California clients are shocked to learn that the fees above are charged agains the gross value of the estate, and not the net value of the estate. In our example, if the $750,000 estate was simply a house with a $500,000 home loan, the fee computation wouldn't change. The estate would still pay statutory compensation based on the full $750,000 value.
That's why many of our California clients choose to place their real estate into a Probate-Avoidance Trust. Don't have a Probate-Avoidance Trust? Call us (818.707.8200) to find out how you can transfer your assets into a Trust that will eliminate the need for a probate court proceeding when your loved ones inherit from you.