California allows a person with a claim to assets in the estate of someone who has died to collect them without going through formal probate by using an affidavit for collection of personal property, elsewhere called a small estate affidavit. This tool can only be used if the estate is worth less than $166,250. And it can only transfer certain assets and requires agreement from everyone else who might have a claim to the assets. However, with its help, an heir can collect bank accounts, stocks and other personal property from an estate much faster and at far less cost than probate. Talk to a financial advisor to help you plan your estate.
Affidavit for Collection of Personal Property Basics
California’s affidavit for collection of personal property is known in some other states as a small estate affidavit. It is a sworn legal document a person can use to assert a claim to assets from the estate of someone who has died. This informal administration of an estate avoids the formal probate process which can take months or years. Probate fees can also significantly cut into the value of the estate
To be eligible for this informal process, California estates can’t be valued at more than $166,250 in total. This amount is increased from time to time to account for inflation.
Only certain assets are used to value an estate for this purpose. These include real property such as a home, personal assets such as bank and brokerage accounts and life insurance or retirement benefits due to the estate. Not included are vehicles and boats, assets jointly owned by someone else and bank accounts or insurance policies with named beneficiaries.
What Is Informal Administration?
Informal administration is a shortcut to the often lengthy and expensive process of administering an estate through probate. It is a form of estate settlement that uses the affidavit for the collection of personal property. Rather than taking months or years as probate can, informal administration can accomplish a transfer of assets within days after the end of the required 40-day waiting period.
Informal Administration Rules
Debts owed by the estate are not considered and will not reduce the value of the estate for the total estate value calculation. Also, while real property is used to calculate the value of the estate, it can’t be transferred using this process. It requires a different form and a longer waiting period.
For personal property, California requires a waiting period of 40 days after the death before this affidavit can be used. Another restriction is that probate cannot already have begun. If probate has started, a personal representative of the estate has to agree in writing to the use of this informal settlement process.
The affidavit doesn’t have to be filed with the court. To use it, the person claiming the assets presents it to the bank, brokerage or another holder of the asset. If the asset holder approves it, the assets normally will be released to the affiant. There are few or no fees to pay. While it’s not legally required, a bank or other asset holder may want signatures on the affidavit notarized, however. This typically costs $20 or less.
A generic affidavit for the collection of personal property forms can be downloaded from the state court website. Local courts may have forms, which can be obtained from the self-help section of the website of the county court. Financial institutions sometimes have their own forms as well.
What’s Included in an Affidavit for Collection of Personal Property?
Most people can complete this form without an attorney because it is simple and straightforward. The document needs to state the following:
- The name of the person who died
- The date and location of the death
- That 40 days have passed since the death
- That probate has not been initiated
- That the estate value does not exceed $166,250
- A description of assets to transfer
- Names of other successors
You can also include attachments, many of which may be required. These documents or attachments include:
- Certified copy of the death certificate of the person who died
- Stock certificate, bank passbook or other proof the person who died owned the asset
- Identification papers such as a driver’s license or passport for the person claiming the asset
- Description and appraisal of real property included in the estate if any.
Everyone named as a successor also must sign the affidavit before it can be finalized. Not signing, or forgetting to get the signature of a successor, can cause the entire process to be rejected. If the estate moves into probate during this time then there is no way to reverse the process.
Pros and Cons of Affidavits for the Collection of Personal Property
There are multiple benefits and disadvantages to using an affidavit for the collection of personal property in the state of California. While it can save you time and money by avoiding the probate process, there are certain limitations that may not make it a viable option. Let’s take a closer look at the largest pros and cons of going down this route.
Pros of Affidavit for Collection of Personal Property
An affidavit for the collection of personal property can be very helpful when a person dies without a will. Affidavits for the collection of personal property offer notable benefits, including:
- It takes less time to get access to assets compared to formal probate
- Costs are much lower than probate
Cons of Affidavit for Collection of Personal Property
Some limits and drawbacks of using these affidavits include:
- Estates must be smaller than $166,250
- Other successors who may have a claim must agree and sign the affidavit
- This process can’t be used to transfer real estate
- Can’t be used once the probate process has begun
The Bottom Line
In California, an affidavit for the collection of personal property can save time and money when transferring assets from the estate of someone who died. The affidavits can only be used when the real and personal property in the estate is less than $166,250. After a 40-day waiting period, an heir can quickly gain control of assets such as bank accounts and stocks by presenting a properly completed affidavit for the collection of personal property to a financial institution or other asset holders. The affidavits can be completed without an attorney and involve little cost or delay compared to probate, but can’t usually be used if probate has already started.
Tips for Inheriting Assets
- A financial advisor can help you with estate planning and other financial matters. Finding a qualified financial advisor who can help doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Inheritance is a common way to receive a financial windfall However, it’s not always as simple as getting a check when a rich relative dies. Wills and other tools for controlling the disposition of someone’s assets after death can be complicated. Taxes, debts and other considerations also made inheritance more complicated.
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