California Living Trust

Introduction

Key Things to Know

1. 1

   California's biggest reason to use a living trust is arithmetic, not privacy: Probate Code Sections 10800 and 10810 pay the personal representative and, separately, the attorney the same fixed statutory percentages of the gross estate value, 4 percent of the first $100,000, 3 percent of the next $100,000, 2 percent of the next $800,000, and 1 percent of the next $9,000,000, a schedule that is not adjusted for inflation and is computed without regard to any mortgage. Only assets you actually fund into your trust skip that fee; anything left in your name alone still pays it through probate.

2. 2

   California is not a Uniform Trust Code state. Its trust law is a free-standing statute, the Trust Law, at Probate Code Division 9, Sections 15000 through 19530, so a source that cites Uniform Trust Code section numbers is citing the wrong state's law; California's own citations start with Probate Code Section 15200.

3. 3

   No notary, witness, or will formality is required to create a California living trust; Probate Code Section 15201 requires only that you manifest an intention to create one. A trust of personal property can even be oral if proven by clear and convincing evidence, though your own oral statement alone is not enough (Section 15207). A trust of real property must be evidenced by a signed writing under Section 15206, and that writing can be signed by the trustee rather than the settlor.

4. 4

   Revoking or amending your trust has its own trap. Probate Code Section 15401 lets you revoke by a signed writing delivered to the trustee, unless your trust instrument makes its own stated method of revocation the exclusive one, in which case only that method works. Section 15401 also bars an attorney-in-fact from revoking or modifying your trust under a power of attorney unless your trust instrument expressly allows it.

5. 5

   California has two homestead systems and they treat a living trust differently. The declared homestead, recorded with the county recorder, expressly excludes "the interest of the beneficiary of a trust" from its protection (Code of Civil Procedure Section 704.910(c)), so recording a declared homestead does not protect a home already deeded into your trust. Whether the automatic homestead exemption, which needs no filing and is based on residence rather than title, survives a transfer into a revocable trust is not resolved by any California statute; ask a California attorney before relying on it. The automatic exemption is the greater of the prior-year countywide median home sale price capped at $600,000 or a $300,000 base, adjusted annually for California's cost of living since January 1, 2022 (Section 704.730); confirm the current figure before relying on it.

6. 6

   California is a community property state, and moving community property into a joint revocable trust does not change its character: Probate Code Section 104.5 and Family Code Section 761(a) both preserve it. Either spouse may revoke the trust alone as to the community property unless the trust says otherwise (Section 761(b)), and the trustee may manage or convey trust property without both spouses joining in unless the trust requires it (Section 761(c)). Loosely worded trust language that treats contributed assets as separate property can count as a transmutation and needs an express written declaration under Family Code Section 852(a).

7. 7

   A California certification of trust must be notarized even though the trust itself does not need to be: Probate Code Section 18100.5(c) requires it to be an acknowledged declaration signed by all currently acting trustees, stricter than a plain signed statement. A bank or title company that demands your full trust instrument in bad faith instead of accepting the certification can be liable for your damages and attorney fees (Section 18100.5(h)).

California Requirements for Living Trust

• California No Notary or Witness Required to Create the Trust

  Probate Code Section 15201 requires only a manifested intention to create the trust, along with trust property, a lawful purpose, and a beneficiary. No notary, witness, or will formality applies to the trust itself, though the funding deed and any certification of trust must be notarized.

• California Probate Fee Schedule Rewards Funding

  Probate Code Sections 10800 and 10810 pay the personal representative and the attorney the same fixed statutory percentages of the gross estate value, computed without regard to any mortgage. Only assets actually retitled into the trust avoid that fee; unfunded assets still pass through probate and pay it.

• California Declared Homestead Excludes a Trust Beneficiary's Interest

  Code of Civil Procedure Section 704.910(c) excludes a trust beneficiary's interest from the declared homestead. Whether the separate automatic homestead exemption survives a transfer into a revocable trust is not resolved by California statute.

• California Community Property Preserved in a Joint Trust

  Probate Code Section 104.5 and Family Code Section 761(a) preserve community character when community property moves into a joint revocable trust. Either spouse may revoke as to the community share alone unless the trust states otherwise (Section 761(b)).

• California Certificate of Trust Must Be Notarized

  Probate Code Section 18100.5(c) requires the certification of trust to be an acknowledged declaration signed by all currently acting trustees. A recipient who demands the full instrument in bad faith is liable for the trustee's damages and attorney fees under Section 18100.5(h).

• California Omitted Spouse Statute Reaches Trust Assets

  Probate Code Section 21601(b) defines a decedent's estate to include property in any revocable trust that becomes irrevocable at death, so a spouse married after the trust was signed and never provided for can claim an omitted spouse share under Section 21610.