Q: We have started to look after my husband's elderly aunt, who is not a family favorite. She is not in the best of health and has no children or husband. She has a handwritten will and has given her sister (my husband's mother) 50 percent and us the other 50 percent (probably due to the fact that we've been helping her).
We didn't really think too much about it because we suspected there really wasn't much money involved - probably just enough to pay her bills. But we've learned recently that the amount is more like $150,000 with at least half in a CD and the rest in stock funds. There is no real estate.
The will does not name someone to execute the will. We plan on dividing our half with my husband's brothers and sisters who can use the money, no matter how small.
Will there be probate required or can we handle this ourselves? -- Kris, Folsom, CA
A: In California, no probate is required for estates with property valued at $150,000 or less, not including assets held in trust or joint tenancy, certain vehicles or assets that pass by beneficiary designation (such as payable-on-death or transfer-on-death accounts). If your husband's aunt's estate is valued at over $150,000 (after you ignore the assets that don't have to be counted toward the minimum), a probate will be required, even if she has a valid will.
If your aunt still has the capacity to make decisions about her estate planning, she could change her CD and/or stock fund to a payable-on-death or transfer-on-death account and name a beneficiary, which would remove the accounts from the calculation of the $150,000 minimum.
If your aunt's will does not name an executor, the Probate Code sets forth the people who have priority to serve as personal representative of her estate. Your mother-in-law would likely have priority over you and your husband, unless she declined to serve.
If your aunt does have legal capacity to make changes to her estate plan, she could also set up a simple trust that would avoid probate, if her estate would otherwise be probated. She may want to update her will and name executors. Holographic wills have more problems associated with them than wills prepared by an attorney, so meeting with an attorney would be advisable.
If you do inherit half of your aunt's estate and decide to give part of it to your siblings, keep your gifts to any one person within the annual gift tax exclusion amount ($13,000 in 2012). If you give more than that to one person, there would be gift tax consequences to giving away part of your inheritance.