A very common question in estate planning is “what happens to my property when I die?” The answer to this question always depends on first, whether you have a will, and if not, which relatives are alive when you pass away. The analysis is the same regardless of whether or not you are married when you die. Each state, including California, has its own laws governing what happens to an estate when there is no will. These laws are known as “intestate succession.” If you have a will, these laws do not apply. Instead, the provisions of your will determine who inherits your property.
If you have a will, your estate will be distributed according to its terms.
A will is a very common estate planning tool used to identify the people, businesses, and/or charities, an individual has chosen to receive a portion of his or her estate upon death. Wills are often used to name a personal guardian for minor children, if necessary. The person who becomes responsible for managing your estate after death and ensuring that your wishes are carried out is known as the “executor.” The executor is usually identified in the will itself. Whether you are single or married when you die, your will determines how your property is distributed. However, if you die “intestate” the laws of your state determine what happens to your property.
The Laws of Intestate Succession in California.
In California, as in nearly all states, your property will go to your closest relatives. Not all assets pass to your heirs through intestate succession, however. Generally, only assets that you own alone in your own name will pass through. Examples of property that does not pass through intestate succession include:
- Any property you transferred into a living trust,
- life insurance proceeds,
- funds in an IRA, 401(k), or other retirement account
- securities held in a transfer-on-death account
- payable-on-death bank accounts
- vehicles held by transfer-on-death registration, or
- property you own with someone else in joint tenancy or as community property with the right of survivorship.
Instead, these assets will pass to the surviving co-owner or beneficiary you named, whether or not you have a will.
Which relatives are in line to inherit in California?
If you have children when you die, but no spouse, parents or siblings, then your children will inherit your estate. Next in line would be your parents and then your siblings.
Who are legally considered to be “children?”
Children who have been legally adopted receive a share just like your biological children. However, foster children stepchildren you never legally adopted do not automatically receive a share. There are some exceptions that can be discussed with your estate planning attorney. Children you placed for adoption and who were legally adopted by another family are no longer entitled to a share of your estate.
There are a few other special circumstances that warrant mentioning. Children you conceived, but were not born before your death (posthumous children) can still receive a share. Children born outside of marriage can only receive a share of your estate if it can be proven that you acknowledge them as your children and contributed to their support.
If you have any questions regarding inheritance and intestate succession, or need assistance in will drafting in California, please give us call.