Navigating the intricacies of estate planning can be complex, especially when it comes to asset distribution after a loved one’s passing. One tool that can simplify matters in California is the Heggstad Petition. This blog will explore what a Heggstad Petition is, how it’s used, and why you would need one.
What Is a Heggstad Petition?
A Heggstad Petition, sometimes referred to as an 850 Petition, is a legal request filed in probate court to confirm the transfer of certain assets that were intended to be part of a trust but were not formally transferred before the Grantor/Settlor/Trustor (the person who created the trust) passed away. Named after a significant court case in California (Estate of Heggstad (1993) 16 Cal.App.4th 943), this petition allows beneficiaries to avoid the lengthy and involved probate process for assets that should have been included in a trust.
Why Would You Need a Heggstad Petition?
Often, individuals create a living trust to avoid probate and ensure their assets are distributed according to their wishes. For assets to avoid probate through the use of a living trust, those assets must be formally transferred to the ownership of the Trust. If assets, such as real estate, bank accounts, or investments, were not properly transferred into the living trust before the trustor’s death, a Heggstad Petition can be filed to confirm that these assets should be treated as trust property.
These petitions are typically filed by the Successor Trustee who stepped into the role after the Trustor’s death. Whereas a typical probate administration can last one to three years and costs tens of thousands of dollars, the use of a Heggstad Petition can last between 6-9 months and be significantly less costly, except where a beneficiary or interested party objects to the petition and, thus, begins litigation.
Result of a Heggstad Petition
A Heggstad Petition is not a rubber-stamp process and must still be decided by a judge based on the evidence presented before the court. If the judge approves the petition, the order signed by the judge will be the legal confirmation that the asset is owned by the Trust as of before the date of death of the Trustor. For real estate, that Order is recorded on the real property title in the County where the real property exists.
If the judge denies the petition without prejudice, the Successor Trustee can choose to refile with new evidence or a different position or the Successor Trustee can begin a probate case for that asset or assets at issue. If the judge denies the petition with prejudice, the Successor Trustee must file a probate case for that asset or assets at issue.
Conclusion
If you believe a Heggstad Petition might be necessary in your situation, consider consulting with a qualified estate planning attorney to ensure your rights and interests are protected. If you are interested in a consultation with Alta Legacy Law to learn more about your specific situation, please contact us at 424-242-5021 or info@altalegacylaw.com.