If you have been named as a beneficiary in a will or trust, you may wonder whether living outside of California affects your ability to inherit. The good news is that where you live does not prevent you from receiving what was left to you. Many beneficiaries no longer reside in the same state as their family members, especially as careers, education, and personal opportunities take people across the country or even overseas. While you do not need to be in California to inherit, there are a few things to consider that could affect how and when you receive your share.
Can an Out-of-State Beneficiary Inherit from a California Estate?
Yes, you can inherit from a California estate even if you live in another state—or another country. California law does not require beneficiaries to be residents of the state. A person creating a will or trust can name beneficiaries anywhere in the world. However, your location may influence certain aspects of the inheritance process.
Common scenarios include:
- An adult child who moved away – If your parents live in California and name you in their will or trust, your inheritance remains valid, even if you now reside elsewhere.
- Multiple beneficiaries in different states – If an estate is divided among siblings or family members across the country, the executor will ensure proper distribution.
- A foreign beneficiary – Receiving an inheritance from a U.S.-based estate while living abroad may involve additional paperwork and tax considerations.
While residency does not affect your right to inherit, understanding potential legal and tax implications can help avoid unnecessary delays.
How Probate Works for Out-of-State Beneficiaries
If the person who passed away did not have a trust, their estate may need to go through probate in California. This court-supervised process ensures that debts are settled and assets are distributed according to the will—or, if there is no will, according to state law.
As an out-of-state beneficiary, you do not need to be physically present in California, but you may need to:
- Sign and return legal documents confirming your identity and inheritance rights.
- Communicate with the executor or attorney to stay informed about the process.
- Appear in court if disputes arise or if the probate judge requires testimony (though this can often be done remotely).
Probate in California can take months or even years, depending on the estate’s complexity. If you have concerns about delays, missing assets, or potential disputes, legal guidance can help ensure you receive what was left to you.
Tax Considerations for Out-of-State Beneficiaries
California does not impose an inheritance tax, so you will not owe state taxes on the assets you receive. However, depending on where you live, your home state may have its own tax laws that could apply. Some states impose an inheritance tax on beneficiaries, which means you might need to report and pay taxes on the assets you inherit. The amount owed, if any, depends on the state’s laws and your relationship to the deceased.
Federal estate taxes apply only to estates exceeding the IRS threshold, which is adjusted periodically. If the estate is subject to federal estate tax, that tax is typically paid before distributions are made to beneficiaries, so you will not need to handle it yourself. If you inherit California real estate but live elsewhere, you may have to file tax returns in both states. Consulting with a tax professional can help you understand your obligations and avoid unexpected tax liabilities.
What Out-of-State Beneficiaries Can Do to Protect Their Interests
If you are inheriting from a California estate but live in another state, taking proactive steps can help ensure a smooth process. Staying informed and involved can prevent unnecessary delays or complications.
Here’s what you can do:
- Maintain regular communication with the executor or trustee to track the progress of the estate.
- Review estate documents carefully to understand your rights and what you are entitled to receive.
- Seek legal guidance if you suspect mismanagement, delays, or disputes over your inheritance.
Being proactive can help protect your rights and ensure you receive what was intended for you.
Ensuring a Smooth Inheritance Process from Out of State
You do not have to live in California to inherit from a California estate, but legal procedures, taxes, and probate timelines may affect how and when you receive your share. At OC Wills & Trust Attorneys, we can help you understand your rights and avoid delays. Contact us today to discuss your situation.
