At Price Law Firm, we frequently address whether funds in checking or savings accounts must pass through the court before heirs can access them. Over the years, we’ve helped local families protect their assets and understand how probate delays can be so frustrating.
This article explains when bank accounts are subject to probate, how they can bypass the court process, and why a carefully crafted plan shields loved ones from unnecessary expense and worry.
Probate in California
Probate is the court-directed method for wrapping up a person’s financial life. The judge reviews the will, appoints a personal representative, and requires an inventory of all the person’s assets.
While that work is underway, the representative must clear debts and taxes, then hand whatever is left to the rightful heirs. When someone dies without a will, the court follows California’s intestate succession rules to choose those heirs.
The timeline is rarely short. Even the simplest estates in our state take about nine months, and more complicated matters can stretch far past a year. At the moment, any estate worth over $184,500 generally goes through this full court process.
- File a petition and publish a notice
- Collect and value assets
- Pay valid creditors and taxes
- Submit the final report and distribute the remaining property
When Do Bank Accounts Typically Go Through Probate?
The way an account is titled makes all the difference. An account owned by one person, with no named beneficiary, is part of the probate estate. Until the court signs off, the funds stay frozen.
By contrast, an account that already has a living co-owner or a clear beneficiary skips this courtroom hold. As a result, many families arrange alternative forms of ownership well before any illness or death occurs.
Options for Avoiding Probate on Bank Accounts
Several straightforward tools move cash to loved ones without the delays listed above. The approach that works best can vary depending on factors such as family size, creditor risk, and tax goals, so it is advisable to consult with counsel before making any changes.
Joint Ownership
Adding a second owner means that person may withdraw every penny the moment you pass away, without needing a court order. The simplicity can be helpful, yet there are trade-offs.
- You lose exclusive control, since either owner may spend the funds at any time.
- Your money becomes reachable by the joint owner’s creditors, divorcing spouses, or lawsuits.
- The surviving owner receives the account without any step-up in basis, which can matter for taxable investment accounts linked to the bank account.
Payable-on-Death (POD) Accounts
A POD designation leaves complete control in your hands while you are alive, then sends the balance to the listed recipient upon death. No probate filing is required, and collecting usually involves nothing more than a certified death certificate and identification.
It pays to review POD paperwork after life changes such as marriage, divorce, or the birth of a child. Out-of-date forms are one of the top reasons beneficiaries miss out on money they were supposed to receive.
Transfer-on-Death (TOD) Accounts
TOD language works almost the same way as POD language; the main difference is that the ownership title itself changes to the beneficiary at death. Securities firms often use TOD, while banks tend to lean toward POD; yet, both methods keep funds clear of probate.
As with POD arrangements, checking your paperwork every few years helps prevent surprises, such as an ex-partner still named on an old form.
Bank Accounts Owned by a Trust
When a revocable living trust serves as the legal owner, the successor trustee may distribute funds according to the trust’s rules immediately after receiving the death certificate. Court supervision is not needed.
The trustee, not individual heirs, must operate the account, and the trustee must follow the terms written by the person who created the trust. Still, the privacy and speed make this path attractive for many families.
The chart below highlights the main differences among these approaches.
| Account Type | Who Controls Funds During Lifetime? | Who Receives Funds at Death? | Subject to Probate? |
| Sole Owner, No Beneficiary | Owner Only | Estate Heirs | Yes |
| Joint Tenancy | Both Owners | Surviving Owner | No |
| Payable-on-Death | Original Owner | Named Beneficiary | No |
| Transfer-on-Death | Original Owner | Named Beneficiary | No |
| Trust Account | Trustee (often the owner) | Trust Beneficiaries | No |
The Significance of a Comprehensive Estate Plan
A solid plan does more than steer cash away from probate court. Clear documents can reduce family fights, lower potential taxes, and give someone authority to act while you are alive but unable to handle your own affairs.
Health care directives, powers of attorney, and well-drafted trusts provide guidance during a medical crisis and after death. When combined with up-to-date beneficiary designations, these documents offer peace of mind that loved ones will not face court battles or uncertainty.
Seeking Help with Estate Planning in California
Each bank, brokerage, and credit union has its own forms, and minor errors can leave an account stranded in probate despite good intentions. Working with Price Law Firm, APC gives you a partner who checks every detail and ties each account into a larger plan.
We have safeguarded the life savings of more than a thousand local families, and we would be glad to answer questions about your own accounts.
Ready to keep your money in familiar hands and out of the courtroom? Call 909-328-7000 or visit our online contact page. A short conversation can reveal simple steps that protect decades of hard work. Let’s talk soon and put a lasting shield around your family’s future.
