When a person dies in California, the probate court will determine if there’s a will expressing the decedent’s wishes on their estate is to be distributed to the named beneficiaries.
If there is a will, it will generally name an executor (or personal representative) to oversee the probate process. If there is no will, the court will appoint an administrator and will also ultimately decide on the distribution of assets.
If you’re drafting a will and have questions about who you should appoint as executor, or if you’ve been named an executor of an estate and are facing probate proceedings, you should familiarize yourself with the qualifications and responsibilities of an estate executor in California.
At the Equal Justice Law Group, Inc., we have been helping clients in the Sacramento, California area with all of their estate planning questions and preparation for 25 years. If you’re writing a will, we can help you every step of the way. If you’re a named executor facing probate proceedings, we can advise and guide you through the whole process.
California Law Regarding
Naming an Executor
The California Probate Code sets two qualifications for the executor of a will:
- The person must be at least 18 years of age
- The person must be of sound mind — that is, a court has not ruled the person incapacitated
Unlike some other states, California does not bar felons from serving as executors, nor does it bar the person drafting the will from naming someone from out of state. Since probate proceedings can take nine months to a year or more, naming someone from outside California may make the executor’s job much more difficult. Generally, appointing someone you know and trust who lives near you is the best option.
The probate court can reject a named executor if it finds “grounds for removal,” which means the court suspects the person is incapable of carrying out the duties or might mismanage or neglect your estate. If it has misgivings about the named executor, the court may hold a hearing with “interested persons” in attendance, meaning heirs, creditors, and the like, or it may just name someone on its own.
The Duties of an Executor
The executor has a fiduciary responsibility to manage the decedent’s estate, which includes the following basic steps (among others), depending on the size and nature of the estate:
- Find the will and obtain the decedent’s death certificate
- Apply for probate
- Notify beneficiaries and other interested parties, including potential beneficiaries not named in the will
- Manage the decedent’s property — protect the property against loss, have its value assessed, sell it off as need to raise funds to cover expenses
- Pay valid claims by creditors
- File and pay any taxes due
- Distribute assets to the beneficiaries after creditors and other expenses have been paid for (including court fees)
- Keep complete records and documentation of every dollar of income and every expense for review and approval by the beneficiaries
- File the final account, once approved by the beneficiaries, with the probate court to close out the proceedings
Even this simplified version of an executor’s responsibilities can sound daunting to the average person. The most important step in the whole process is to hire an attorney to advise and guide you — and to deal with any challenges that arise from creditors, beneficiaries, or overlooked heirs during the proceedings.
How is the Executor Compensated?
Under California law, a will can specify compensation for the executor, but if it does not, then a percentage scale is used:
- Four percent of the first $100,000 of the estate’s value
- Three percent of the next $100,000 of the estate’s value
- Two percent of the next $800,0000 of the estate’s value
- One percent of the next $9 million of the estate’s value
- Five one-hundredth’s of a percent (0.05%) of the next $15 million of the estate’s value
California law also allows for repayment of “extraordinary services,” such as preparing tax forms, selling or foreclosing property, managing the decedent’s business, and overseeing audits and lawsuits. These services would also often require the help of outside professionals, who would have to be remunerated from the estate.
Estate Planning Attorney
Even this brief introduction to the duties of an estate’s executor shows that the responsibilities are complex and challenging. Generally, depending on the size of the estate, the best approach is to seek the help of an experienced and knowledgeable estate planning attorney who can answer the many questions that arise and help negotiate with creditors and others who may raise objections to the will or the distribution of assets.
At the Equal Justice Law Group, Inc., we have been helping clients with estate planning for a quarter of a century. If you’re located in Sacramento, California, or nearby in Jackson, Eldorado Hills, or Placerville, contact us immediately with your estate planning questions and needs — especially if you’re an executor entering probate proceedings.