Legal Question in Wills and Trusts in California
My mother has two accounts at her bank. One is a checking account with about 40,000. The other is a savings account with about 450,000.
My wife is on both accounts and does 100% of the banking. Most of it is check writing on the checking account to pay my mothers bills etc.
When my mother dies, what needs to be done in order for my wife to get control of the savings and checking both? I think I read in another post that it is up to 100,000 there are no problems but this is a much bigger chunk of change here. My mother is still alive so any changes that need to be made she can make them. She has terminal cancer and has been given about 3-6 weeks to live so we are trying to make sure there isn't going to be any issues down the line. Is probate something that will happen with this money since it is over 100,000? Is there anything we can do before hand to prevent probate? Maybe split the money up, put it in multiple accounts etc?
1 Answer from Attorneys
I am very sorry about your mother's medical condtion; my mother was able to survive her cancerous condition.
You all need to go immediately to an attorney who is an expert in estate planning and who is in your local area. The banks probably will only require a death cerificate, and perhaps not even that if your wife is listed as co-owner on the accounts. But the IRS might treat it as income as I suspect the banks will report a transfer of such large amounts to the IRS.
In California, estates with assets greater than $100,000 must go through probate. There should be no estate tax because the exemption is much higher than the amount of her cash assets, but she may also have a home and other assets. It can easily cost $20-30,000 if someone besides you or your wife get appointed administrator. You also need to consider what if your mother will have to pay herself the medical bills, etc. Also, handling an estate is a pain in the neck and and good attorney and help make it easier; yo do not have to retan the attorney to do the administration of the estate, but it is well worth spending the $350 per hour or so to plan everything out, as you will save much more in money and trouble by doing so. You should also look at some of the Nolo Press books to get a lay person's explanation of what might happen ands so you know whether the attorney you hire is competent.
Good luck.
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