Thoughts on California Estate Planning: January 2026

Hold on tight to your money and don’t let your children see it until you die. Damnit, you had to work for every penny, and so should they. If you give them money now, they’ll get soft, reckless, and join the circus.

If you're afraid your kids will blow their inheritance on parties, Draftkings, and a G-Wagon, there are trusts that can help.

Proposition 19 reminder: If you inherit your parents' home and intend to make it your home, make sure you get the forms to the county assessor in time, especially the parent-child exclusion form and homeowner's exemption form - before the assessor reassesses the property and jacks up the property tax.

Once memory starts playing hide-and-seek, it’s game over for estate planning. So nudge your parents to get theirs done while they can still remember where they parked their car.

As of January 1, 2026, California’s Medi-Cal program has reinstated asset limits for long-term care eligibility, rolling back to the 2023 rules.

Also, as of January 1, 2026, the estate tax exemption is $15 million per person or $30 million per married couple - indexed for inflation in subsequent years. This eliminates the estate tax for almost everyone.

The 2026 California probate threshold is $208,850. This has nothing to do with the estate tax exemption. Don't confuse probate and estate tax. Just because you won't have an estate tax doesn't mean your estate won't go through probate.

Life insurance and retirement plans are off limits to your creditors when you die - if you've named a beneficiary. If you forget to name a beneficiary, then they will be included in your estate and will be fair game to your creditors.

A basic truth about estate planning: your estate plan will have a big impact. Whether you leave ten thousand, hundreds of thousands, or millions to your beneficiaries, it will make a big impact on their lives.