California is a community property state. Community property generally includes property acquired during marriage, and each spouse typically owns a one-half interest. An estate plan should clearly identify what type of property is being placed into a trust. Proper characterization can help avoid disputes, preserve the surviving spouse’s rights, and may also provide important tax benefits, including potential basis adjustment for appreciated community property.
Many Acton homeowners don’t realize that if their estate exceeds the $208,850 small estate probate threshold, their estate would be subject to a full probate proceeding without proper estate planning in place. California also has a separate simplified procedure for a decedent’s California primary residence valued at $750,000 or less, but this still requires a court petition and is not the same as avoiding probate entirely. The best way to avoid probate is to properly fund a revocable living trust, keep beneficiary designations current, and use tools like joint ownership or transfer-on-death designations where appropriate.
Proposition 19 changed the rules for parent-to-child property tax transfers – critical for Acton families. An estate planning attorney can help families evaluate whether a trust-based plan, transfer strategy, co-ownership structure, or beneficiary plan may trigger reassessment, and can coordinate the necessary filings and timing with the county assessor. This is especially important when parents own highly appreciated real estate, rental property, or multiple properties, because Prop. 19 may significantly affect the tax cost of inheriting and keeping property.
