The Importance of the Pourover Will

The Importance of the Pourover Will

By: Debbie B. Jones, Esq.

November 23, 2021

In California if you prepare a Revocable Trust to transfer your assets outside of the Probate Court, it is essential that you include a Pourover Will as part of your complete Estate Plan.

When a Revocable Trust has been created, the creator of the Trust must “fund” the trust with their assets. This includes recording a grant deed of your residence into the Trust and in some cases naming the trust as a beneficiary on financial accounts. If for some reason a property is removed from the trust for refinancing or a new property is purchased, and then not transferred back into the Trust, it could cause a problem when the Trustor dies.

“Pourover” describes a testamentary transfer of the decedent’s nontrust assets to the trustee of a revocable trust that becomes irrevocable on the Trustor’s death.

The State of California enacted a statute to address transferring nontrust assets by Pourover Will to the Trustee of a Revocable Trust, that has become irrevocable by death of the Trustor.

The Uniform Testamentary Additions to Trusts Act (Prob. Code, §§ 6300-6303) expressly permits testamentary gifts to revocable trusts. The Pourover Will has one function: to distribute the Trustor’s property according to the Trustor’s wishes even though that property wasn’t transferred to the trust during the Trustor’s lifetime. This could happen either because the assets were acquired after the revocable trust’s initial funding or because the revocable trust was only nominally funded during the Trustor’s lifetime.

The assets transferred are added to and administered as part of the now irrevocable trust along with its existing assets. In this way, the Will “pours over” into the Trust. The pourover doesn’t happen automatically, the trustee must still take action:

  • If the value of the assets not yet transferred to the trust doesn’t exceed $166,250, the trustee may be able to collect the assets without probate under the affidavit procedure in Probate Code section 13100; or
  • If the value of the assets not yet transferred to the trust exceed $166,250, the Trustee will have to petition the court for permission to transfer the items into the Trust for distribution according to the terms of the Trust, also known as a Heggstad Petition.

In order for the Heggstad Petition to be successful, the Trust must be identified in the Will of the decedent, and the Will must indicate that the decedent transferred the residue of the estate into their Trust.

If avoiding Probate is your primary objective with your Estate Plan, please make sure that your Estate Plan includes a Pourover Will. If you have questions regarding your current Estate Plan or if you are considering creating your Estate Plan be sure to contact BPE Law Group and discuss with our Estate Planning professionals.

The information presented in this Article is not to be taken as legal advice. Every person’s situation is different. If you are facing a legal issue of any kind, get competent legal advice in your State immediately so that you can determine your best options.

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