During the probate of an estate, certain family members of the deceased person may request an allowance to be paid from the estate for their maintenance. California Probate Code Section 6540 states that:

(a) The following are entitled to such reasonable family allowance out of the estate as is necessary for their maintenance according to their circumstances during administration of the estate:

(1) The surviving spouse of the decedent.

(2) Minor children of the decedent.

(3) Adult children of the decedent who are physically or mentally incapacitated from earning a living and were actually dependent in whole or in part upon the decedent for support.

(b) The following may be given such reasonable family allowance out of the estate as the court in its discretion determines is necessary for their maintenance according to their circumstances during administration of the estate:

(1) Other adult children of the decedent who were actually dependent in whole or in part upon the decedent for support.

(2) A parent of the decedent who was actually dependent in whole or in part upon the decedent for support.

(c) If a person otherwise eligible for family allowance has a reasonable maintenance from other sources and there are one or more other persons entitled to a family allowance, the family allowance shall be granted only to those who do not have a reasonable maintenance from other sources.

In other words, this statute covers people who primarily relied on the deceased person for support. It also limits the ability of those who already have a reasonable amount of resources from requesting an allowance.

Family allowances are problematic because of the significant amount of time it takes to go through the probate process in California. Often, probate administration lasts a year or more. Thus, for example, if a decedent named non-family members as beneficiaries of his or her Will, it's possible that the family allowance would eat away at the named beneficiaries' inheritance.

Some counties limit the amount of time that a family allowance will last, but California Probate Code Section 6543 states that:

(a) A family allowance shall terminate no later than the entry of the order for final distribution of the estate or, if the estate is insolvent, no later than one year after the granting of letters.

(b) Subject to subdivision (a), a family allowance shall continue until modified or terminated by the court or until such time as the court may provide in its order. 

In other words, the family allowance may continue until (1) the judge issues the final order distributing the assets of your estate, or (2) if the liabilities of the estate exceed its assets, no later than one year after "Letters" (the document officially appointing your Executor or Administrator) is granted.

It's therefore important to talk with an estate planning lawyer to determine whether a family allowance poses a significant risk in your particular case.

Making a gift to a minor may be difficult for a number of reasons. The minor may not be legally able to manage the property that you leave for them. In addition, they may not be responsible enough to manage the asset for their long term benefit.

For some, making gifts to their minor children may be a technique to reduce the size of their estate for estate tax purposes. Whatever the reason may be, there are a couple of options for making a gift to a minor that may be suitable depending on your specific situation.

Trusts

Some people decide to use a trust as the primary vehicle for holding and managing property for a minor. The trust has the benefit of having a Trustee who can manage the trust asset and who may be granted the discretion to make distributions to or for the benefit of a minor child. This trust could be established for your child either while you're alive, or it can be set up at the time of your death.

One downside to using a trust, however, is that the cost of maintaining a separate trust for a minor child may be excessive in relation to the value of the assets held in the trust. 

California Uniform Transfers to Minors Act

Where the gift to minor person is relatively small, using a custodial account under the California Uniform Transfers to Minors Act (CUTMA) may be more attractive. Generally, the gift is held by the Custodian you select until the minor child reaches a specified age.

Figuring out the best way to transfer your assets to minor beneficiaries can be challenging. Most people grapple with the desire to provide for the child but not grant unfettered access in a way that would cause the minor to lose motivation in pursuing his or her own life goals. Estate planning lawyers can provide helpful insights on how to structure such a gift.

Sometimes the obstacles to transferring property for estate planning purposes are outside of your control. The restrictions may be due to your marital status or status as a registered domestic partner, or the type of asset, such as an interest in a trust for which you may be beneficiary (i.e., a trust that was not created by you, but for your benefit).

However, restrictions may also be self-imposed, such as by agreements that you have with others not to transfer your property. A major hurdle in transferring property occurs when the transferring person loses the capacity to make the transfer.

Finally, even if you have the legal ability to make the transfer, you may nonetheless, wish to retain absolute control over property.

Lack of Legal Capability

A risk faced by some individuals is the possibility that someone will challenge the estate planning documents after you pass away. This often comes in the form of a challenge to the Will or other estate planning document that you've created.

You may have heard of this terminology before, but the challenges can range from the following:

1. Failure to follow the formalities required when signing the estate planning documents. 
2. Lack of capacity, mental or otherwise, to sign the estate planning documents.
3. The assertion that there was fraud, duress, or undue influence.

Risk Minimization

If you are clearly competent, and your lawyer is not in a position where there's a conflict of interest, others are not unduly influencing the decision-making or otherwise inappropriately pressuring you to make a decision, and the proper formalities of signing your estate planning documents are followed, the risk of someone challenging your estate plan is relatively low. 

Although estate planning may present challenges even after the documents are prepared and signed, the risk of having your transfer fail can be minimized by introducing an independent lawyer to draft the documents. He or she can be on the lookout for potential future causes of challenges to your estate plan and can help you to navigate away from them.

Even if you already have an estate plan, it's still important to review it periodically to ensure that your wishes are accurately reflected. By reviewing your estate plan every 1-3 years, you can make sure that you and your family's needs are appropriately met. 

Updating Your Estate Planning Documents

If some time has passed since you created your estate plan, you may want to consider reviewing it (either with or without an estate planning lawyer) to see if there's anything you want to update.

If circumstances have changed since you initially created your estate plan, then you may need to hire an estate planning lawyer to help you make updates. Here are some common situations that prompt people to update their estate planning documents:

1. The death or birth of family members.
2. A substantial increase or decrease in wealth.
3. Changes in the law.

Partial Amendment or Restatement? 

If the changes to your Revocable Living Trust or Will are minor, you may only need a partial amendment or codicil, respectively.

However, if the changes are substantial, it's often best for the lawyer to "restate" or re-write the entirety of your trust or Will. This is often because your existing trust may contain provisions that depend on one another and making too many changes may detrimentally affect how your trust operates.

Indeed, with the rise of word processing and document assembly programs, restating documents can often be much cheaper than trying to hobble together changes to an existing document.

In simple situations, estate planning documents rarely need a complete overhaul. However, it's still a good idea to review your estate planning documents periodically, and at the very least, when there are major events such as the birth or death of a family member. In fact, you might consider setting a date every year where you review your financial situation, as well as your estate planning documents to ensure that both are performing properly.

Be Prepared

Kudos to you if you've already established an estate plan. You're among the small minority of responsible adults! You (and more importantly, your family) are likely in a much better position than other people you know. Interestingly, after a client finishes signing their estate planning documents, they often sigh and tell me how relieved they are. When I ask how it feels to be done, they reply, "I honestly can't believe I waited so long. I feel a sense of relief about concerns that I didn't even know I had!"