Disadvantages of community property with a right of survivorship: If a spouse dies having willed a property titled as community property with a right of survivorship to someone other than their spouse, their gift may be deemed invalid.
Typically, there's peace of mind that comes with knowing that your estate will be distributed according to plan. However, don't be too quick to relax. Typically, a beneficiary designation overrides a Will.
California courts recognize that survivorship rights in joint bank accounts may be challenged if clear and convincing evidence demonstrating the original account holder had contrary intentions than what was assumed in its creation.
The reason is that almost all joint accounts have what's called the "right of survivorship," which means that when one owner dies, the survivor automatically owns all the money in the account. A provision in a will or living trust can't override that.
Generally, the right of survivorship will take precedence over a Last Will and Testament if the jointly-owned property is distributed wrongfully in someone's estate plans. Therefore, you shouldn't list any property in your Will that you and another person(s) jointly own with the right of survivorship.
In California, a trust often supersedes a will if a person has created both documents. A trust takes effect immediately, while the trustee is still alive, whereas a will only takes effect after the death of the executor. The trust is a separate legal entity that owns all assets that have been transferred into it.
The right to survivorship refers to the legal principle that upon the death of a joint owner, the remaining owner(s) automatically inherit the deceased owner's share of property or assets without having to pass through probate. Here's how it works.
But let's say that Sara dies, and then Tomas dies 10 days later. Without a survivorship period, he would inherit everything. The assets would then pass under the terms of his will—perhaps to Sara's no-good nephew—not to the charity that she named as alternate beneficiary.
This is what the right of survivorship means. The survivors split the interests. Eventually, when all but the final joint tenant dies, the last person standing will have total rights to the property. He or she can then pass that property on to his or her children or anyone else.
Beneficiary Designation Takes Precedence Over A Will
If your heirs decide to fight the beneficiary designation in court, litigation can be expensive and take months.
Fraud – The decedent was deceived into creating a new will, amending their will or revoking their will. Forgery – A decedent's will was fraudulently signed by someone other than the decedent. Lack of Due Execution – The legal protocol for executing a will was not followed precisely.
A right of survivorship has distinct benefits to those estate planning, including: Smooth, automatic transfer of property upon death to surviving tenants. Bypasses the often time-consuming and costly probate process.
Right of Survivorship by Default: Generally, joint bank accounts are presumed to have rights of survivorship unless otherwise specified.
This isn't permanent, and joint tenancy with right of survivorship can be canceled or changed if all owners agree, if one sells their share in the property or if all owners die at the same time.
A valid right of survivorship always overrides a Will. This is because a property that has a right of survivorship passes automatically to the surviving owner, and legally so. Thus, the property legally cannot be included as a part of the deceased owner's estate.
To avoid the first estate passing through probate twice in quick succession, saving on administration costs; and. To impose some control over the eventual destination of assets. This control is only minimal though, considering most survivorship clauses are expressed as 30 days.
In some cases, the executor can sell the house without getting the sign-off from all the heirs. For example, in California, if the executor can sell the property for at least 90 percent of its appraised value, they may have the authority to move forward with the sale.
A joint account generally passes outside of the will because it is considered to be a non-probate asset meaning it passes directly to the surviving owner rather than through the will.
What assets pass via the Right of Survivorship? Most cash assets will pass automatically via the right of survivorship. The most common/obvious one being a joint bank account. Some jointly owned land will also pass automatically to surviving joint owners (see below).
Problems With Joint Ownership
By jointly owning property, you may find yourself party to a lawsuit if your co-owner is sued or the asset could be lost to a creditor of your co-owner. If your co-owner becomes incapacitated, you could find yourself “owning” the property with the co-owner's guardian or the courts.
It's possible you have already designated who receives certain assets in documents requiring the naming of beneficiaries, such as life insurance policies or retirement accounts. Accounts and property held jointly often pass to the surviving owner. These designations supersede your will.
An executor does not possess the power to overrule or change the terms established by a trust; these roles carry separate responsibilities. An executor's role consists of overseeing and closing an estate as per its will's instructions without disrupting or interfering with their independent functions as trustee.
According to California probate law, a trust often supersedes a will if a person has created both instruments. That means the trusts can serve the same purpose but with additional benefits such as enhanced privacy, asset protection, and the ability to circumvent probate.