Hi. I’m wondering if it’s possible for a married couple to do this: 1- for spouse A to hold title to an investment property (in CA) as “sole and separate”. 2- for that property to *automatically* be transferred/inherited by spouse B upon the death of spouse A. Note that spouse B signed a quit claim deed, to make the property officially sole and separate.
In this case there are no children from the marriage, only the 2 spouses. The idea is to avoid probate, and have all assets automatically transfer to spouse B. BUT also to have the assets owned by spouse A as sole and separate while alive.
Any simple ideas on how to hold title to achieve this? Because my understanding is that if the property is held by spouse A as sole and separate, and spouse B signed a quit claim deed, then upon death of spouse A the property would go into probate?
Have they considered a trust? Pretty easy to do with a trust. Would avoid probate too. Is there a reason for sole and separate as opposed to joint tenancy (if they’re concerned with automatic passing to spouse and avoiding probate)? Sounds like they do want to retain the separate property designation. Transfer on death deed? They probably should speak with an estate planning attorney about their specific situation.
*this post does not create an attorney-client or cpa-client relationship. Readers are advised to seek professional advice. The information contained in this post is not to be relied upon.
@Katie Lepore thanks for that advice. Do you know if a simple trust like that can be created online, or otherwise inexpensively? Also, is there a name or type of trust (such as a living trust, etc.) this would fall under?
@Amit M. I would strongly caution against forming a trust yourself online. But, yes, there are companies that will do so. There's that saying.... "you get what you pay for." If you live in California, you really should look into having your estate plan completed with a reputable and competent attorney. A trust is important to avoid probate in California, which is a very long public court proceeding that happens after death, and can cost tens of thousands of dollars to complete. Your assets are tied up during the process and the public has access to information about your net worth and assets. All of that can usually be avoided by paying a few thousand dollars for an estate plan. Along with a trust, you'll want Wills and health care directives and powers of attorney and whatnot. Your estate planning attorney should also be able to counsel you as to how to properly hold title, transferring assets into the trust, tax consequences, and more. He or she should be able to prepare a deed to transfer your real property as well. This is an important task to do for your family and peace of mind, as probate encompasses a lot more than just real property holdings. Probate will look at the entirety of your assets held at death, so understanding how to hold title to your non-real estate assets is important as well. And yes, often this type of trust is called a living trust, revocable trust, or a family trust, or also grantor trust (which refers to a specific tax designation).
*This post does not create an attorney-client or CPA-client relationship. The information contained in this post is not to be relied upon. Readers are advised to seek professional advice.