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Legal & Tax Disclosure
ATTORNEY ADVERTISING.
This article is provided for general informational purposes only and does not constitute legal, financial, or tax advice. Reading this content does not create an attorney-client or professional advisory relationship. Laws vary by jurisdiction and are subject to change. You should consult a qualified professional regarding your specific circumstances. |
I recently had a client, Bradley, discover over $15,000 in unclaimed funds belonging to his late mother. He was understandably thrilled, but then quickly became overwhelmed when he realized the process of claiming it wasn’t as simple as just filling out a form. It rarely is, especially after someone has passed away. The requirements vary significantly depending on the type and location of the property, and strict adherence to legal protocols is crucial to avoid delays or outright denial of the claim.
What Constitutes Unclaimed Property?
Unclaimed property isn’t hidden treasure, though it can certainly feel like it. It typically refers to assets the owner has lost track of. This includes forgotten bank accounts, uncashed checks, stocks, bonds, insurance payouts, even safe deposit box contents. Most states have official websites where you can search for unclaimed property by the deceased person’s name. However, this is just the first step. Determining the proper claiming process requires understanding the asset’s nature and where it’s located. For example, unclaimed stock dividends are handled differently than an abandoned utility deposit.
The Role of the Will and Probate
If the deceased person had a valid Will, the named executor is generally responsible for identifying and claiming unclaimed property. However, the Will alone doesn’t guarantee a smooth transfer. If the total combined ‘probate assets’ (excluding the AB 2016 residence) exceed $208,850 (the threshold effective April 1, 2025), they are subject to formal probate; a Will alone does not allow you to bypass this limit. Probate is the legal process of validating the Will, inventorying assets, paying debts, and distributing remaining property to heirs. Unclaimed property is considered part of the probate estate, and all claiming must follow probate court guidelines.
AB 2016 and the Petition for Succession
California’s AB 2016 provides a simplified process for smaller estates. For deaths on or after April 1, 2025, a primary residence valued up to $750,000 qualifies for a ‘Petition for Succession’ under AB 2016 (Probate Code § 13151). It’s crucial to understand this is a “Petition” that requires a Judge’s Order, NOT an “Affidavit.” Furthermore, to qualify, the decedent’s other non-real estate assets (cash, stocks, etc.) must typically remain below the separate $208,850 Small Estate limit. The Small Estate Affidavit (strictly for real property <$69,625, used for timeshares/vacant land) is a separate process for much smaller holdings.
Digital Assets and RUFADAA
Don’t overlook digital assets – these are often significant sources of unclaimed property. Without specific RUFADAA language (Probate Code § 870) in your Trust or Will, service providers like Coinbase and Google can legally deny your executor access to your digital assets. This is because privacy laws protect these accounts. RUFADAA allows for designated digital custodians, providing your executor the necessary authority to access and claim these assets. It’s a vital inclusion in any modern estate plan.
The CPA Advantage in Valuing Assets
As both an Estate Planning Attorney and a CPA with over 35 years of experience, I often emphasize the benefit of a dual perspective. Properly valuing assets is critical for claiming unclaimed property, particularly when it involves stocks, bonds, or business interests. A CPA can accurately determine the step-up in basis, calculate potential capital gains taxes, and handle complex valuations. This ensures you’re not only claiming the full amount of the property but also minimizing your tax liability. Accurate valuation also plays a crucial role in ensuring compliance with state and federal regulations, reducing the risk of audits or penalties.
Business Interests and FinCEN Reporting
If the deceased person owned an LLC, claiming unclaimed property from business accounts can be complex. As of March 2025, domestic U.S. LLCs are exempt from mandatory BOI reporting under the Corporate Transparency Act; however, executors managing foreign-registered entities must still file updates within 30 days to avoid fines of $500/day. The FinCEN 2025 Exemption adds a layer of compliance that requires professional guidance.
Strategic planning for this specific asset is important, but it must be supported by a Will that can withstand California judicial review.
As a dual-licensed CPA and Attorney, I warn clients that specific asset strategies are useless if the core Will fails to meet probate standards.
To protect your family from unnecessary conflict, you must understand how judges evaluate the enforceability of your Will:
How do California courts decide whether a will reflects true intent or creates ambiguity?
In California, a last will and testament operates within a probate system that emphasizes intent, clarity, and procedural compliance. When properly drafted, a will does more than distribute property—it creates legally enforceable instructions that guide courts, fiduciaries, and beneficiaries through administration with fewer disputes and less uncertainty.
- Clarity: Avoid vague terms that trigger probate disputes.
- Incapacity: verify mental state at signing.
- Errors: check for missing amendments often.
For California residents, understanding how intent, authority, and compliance interact is one of the most effective ways to protect family harmony and estate integrity. A will that anticipates probate scrutiny is far more likely to be honored as written and far less likely to become the source of unnecessary conflict.
Resources for Asset Management & Transfer
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Property Tax Reassessment: California State Board of Equalization (Prop 19)
This page details the “Base Year Value Transfer” rules. It explains that heirs can only avoid a property tax reassessment if the inherited home becomes their primary residence and a claim is filed within one year of the date of death. -
Real Estate Probate (AB 2016): California Probate Code § 13151 (Petition for Succession)
The specific statute for the AB 2016 process. It outlines the requirements for using a court-approved “Petition” (not an affidavit) to transfer a primary residence worth $750,000 or less (gross value) for deaths occurring after April 1, 2025. -
Small Estate Affidavit: California Probate Code § 13100 (Personal Property)
Access the statutory language for the “Small Estate Affidavit.” This procedure is strictly for Personal Property (cash, stocks, vehicles) and is limited to estates with a total value of $208,850 or less (effective April 1, 2025). -
Federal Estate Tax: IRS Estate Tax Guidelines
The authoritative federal resource for estate valuation. It reflects the 2026 exemption increase to $15 million per person established by the One Big Beautiful Bill Act (OBBBA), which is critical for high-net-worth asset planning. -
Unclaimed Assets: California State Controller – Unclaimed Property
The primary portal for executors and heirs to search for “lost” assets—such as forgotten bank accounts, uncashed dividends, and insurance benefits—that have been remitted to the State of California for safekeeping. -
Business/LLC Compliance: FinCEN – Beneficial Ownership Information (BOI)
The official portal for corporate transparency reporting. While many domestic U.S. LLCs received exemptions in 2025, executors managing foreign-registered entities or specific non-exempt structures must still consult this resource to ensure compliance.
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Attorney Advertising, Legal Disclosure & Authorship
ATTORNEY ADVERTISING.
This content is provided for general informational and educational purposes only and does not constitute legal, financial, or tax advice. Under the California Rules of Professional Conduct and State Bar advertising regulations, this material may be considered attorney advertising. Reading this content does not create an attorney-client relationship or any professional advisory relationship. Laws vary by jurisdiction and are subject to change, including recent 2026 developments under California’s AB 2016 and evolving federal estate and reporting requirements. You should consult a qualified attorney or advisor regarding your specific circumstances before taking action.
Responsible Attorney:
Steven F. Bliss, California Attorney (Bar No. 147856).
Local Office:
Escondido Probate Law720 N Broadway 107 Escondido, CA 92025 (760) 884-4044
Escondido Probate Law is a practice location and trade name used by Steven F. Bliss, Esq., a California-licensed attorney.
About the Author & Legal Review Process
This article was researched and drafted by the Legal Editorial Team of the Law Firm of Steven F. Bliss, Esq.,
a collective of attorneys, legal writers, and paralegals dedicated to translating complex legal concepts into clear, accurate guidance.
Legal Review:
This content was reviewed and approved by Steven F. Bliss, a California-licensed attorney (Bar No. 147856). Mr. Bliss concentrates his practice in estate planning and estate administration, advising clients on proactive planning strategies and representing fiduciaries in probate and trust administration proceedings when formal court involvement becomes necessary.
With more than 35 years of experience in California estate planning and estate administration,
Mr. Bliss focuses on structuring enforceable estate plans, guiding fiduciaries through court-supervised proceedings, resolving creditor and notice issues, and coordinating asset management to support compliant, timely distributions and reduce fiduciary risk. |
