Inheriting a House in California: Probate, Taxes, and Selling

You inherited a house in California - here’s what actually happens

First, take a breath. Nothing about the house has to be decided this week. The property does not vanish, the state does not seize it, and in most cases the mortgage company cannot demand immediate payoff just because the owner died.

What happens next depends on how the owner held title. If the house was in a living trust, had a recorded transfer on death deed, or was owned in joint tenancy, it may skip probate entirely. If it was simply in the deceased person’s name, it usually goes through California probate court before anyone can take clear title.

Many people who inherit California property live somewhere else entirely. That is normal, and everything in this guide - including selling the house - can be handled remotely with the right local help.

Does it go through probate?

Not always. California has several off-ramps:

• Living trust. If the house was held in a revocable living trust, the successor trustee transfers or sells it without court involvement. This is the cleanest path.
• Transfer on death deed. California allows revocable transfer on death (TOD) deeds. If one was recorded, the named beneficiary takes the house outside probate, subject to some notice and waiting-period rules.
• Joint tenancy or community property with right of survivorship. The surviving co-owner takes full title by recording an affidavit of death, no probate needed.
• Surviving spouse. Property passing to a spouse can often use a simplified spousal property petition instead of full probate.
• Small estate procedures. For deaths on or after April 1, 2025, personal property up to $208,850 can pass by affidavit without probate. More importantly for a house: under AB 2016, a home that was the decedent’s primary residence and is worth up to $750,000 can pass through a streamlined court petition (a petition to determine succession to real property) instead of full probate. It still involves a court filing and hearing, but it is faster and cheaper than a full case. These dollar limits adjust periodically.

If none of those apply - a solely owned house above the thresholds, or a non-primary residence - full probate in the superior court of the county where the person lived is the default.

The California probate timeline

Full probate in California commonly runs 9 to 18 months, and complicated or contested estates can take longer. The broad shape:

1. Filing (month 1-2). Someone petitions the court to be appointed executor (with a will) or administrator (without one). Courts set the first hearing several weeks to a few months out, depending on the county’s backlog.
2. Letters issued (month 2-4). Once appointed, the personal representative gets “letters” - the document banks, title companies, and buyers will ask for.
3. Notice, inventory, and creditor period (months 3-8). Known creditors get notice and generally have four months to file claims. The estate’s assets, including the house, get inventoried and appraised by a court-appointed probate referee.
4. Administration (ongoing). Bills, taxes, and upkeep on the house get handled. The house can often be sold during this window - more on that below.
5. Final petition and distribution (month 9+). The court approves the accounting and orders distribution to heirs.

One cost note: California sets statutory probate fees for attorneys and executors as a percentage of the gross estate, so probate on even a modest house is not cheap. That is a big reason trusts and the $750,000 primary-residence petition matter here.

Taxes when you inherit

The single most useful fact for most inheritors: California has no state inheritance tax and no state estate tax. You do not owe California a tax simply for inheriting.

Federally, very few estates owe estate tax either - the federal exemption is $15 million per person for deaths in 2026, so it touches only very large estates.

What most families actually care about is the stepped-up basis. When you inherit, the property’s cost basis for capital gains purposes resets to its fair market value on the date of death. If your mother paid $80,000 for a house now worth $900,000, your basis is $900,000 - not $80,000. Sell it soon after for around $900,000 and there is little or no capital gains tax. Decades of appreciation are effectively wiped clean for tax purposes. This is federal law and applies in every state.

California adds one twist that catches many heirs off guard: property tax reassessment under Proposition 19. Since 2021, inheriting a parent’s home no longer automatically preserves their low property tax bill. The parent-child exclusion now generally applies only if the home was the parent’s primary residence, the child moves in as their own primary residence within a year, and even then the excluded value is capped (roughly $1 million over the old assessed value, adjusted periodically). If you keep the house as a rental or second home, expect the property taxes to reset to market value. For heirs planning to sell anyway, this matters less - but it changes the math for anyone thinking about keeping the property.

Can you sell during probate in California?

Yes, in most cases - you do not have to wait for probate to end.

How easy it is depends on the personal representative’s authority under the Independent Administration of Estates Act (IAEA):

• Full authority (the common case). The representative can sell the house on the open market like a normal sale. Heirs and beneficiaries get a notice of proposed action, and if nobody objects within the notice period, the sale closes without a court hearing.
• Limited or no IAEA authority. The sale needs court confirmation. The accepted offer goes to a hearing where other buyers can overbid it in open court (the first overbid must beat the price by a set formula), and the judge confirms the winning bid. These sales take longer and some buyers avoid them, but they close every day in California.

Either way, sale proceeds go into the estate account and get distributed at the end - they don’t go straight to individual heirs at closing.

If you live out of state

A large share of people who inherit California property live in another state. The system is built to handle it:

• Court filings, notarized documents, and even most hearings can be handled remotely or through a California probate attorney.
• The real work - securing the house, clearing out belongings, maintenance, insurance on a vacant home, and eventually preparing it for sale - needs someone physically there.
• A local real estate agent who knows probate sales becomes your eyes on the ground: checking the property, coordinating cleanout and repairs, advising whether to sell as-is or fix first, and handling showings while you stay home.

The practical takeaway: you do not need to fly back and forth. You need one good local professional and a clear picture of what the house is worth.

What’s the house worth?

Before any decision - keep, rent, or sell - you need a real number, not a guess. Automated estimates on big portals can miss badly on inherited homes, which are often original-condition and hard to compare to renovated sales nearby.

Date-of-death value matters twice in California: it sets your stepped-up basis for taxes, and the probate referee’s appraisal will use it too. Then current market value, in the house’s actual condition, tells you what selling as-is looks like versus investing in repairs first. A local agent can pull both numbers for free.

Frequently asked questions

How long does probate take in California? Commonly 9 to 18 months for a full probate, driven mostly by court backlogs and the four-month creditor period. Trust administrations and small-estate procedures are much faster - often a few months.

Do I pay taxes on a house I inherit in California? There is no California inheritance or estate tax, and federal estate tax only touches estates above $15 million (2026). Thanks to the stepped-up basis, capital gains tax usually applies only to appreciation after the date of death. Property taxes, though, may be reassessed under Prop 19 if you keep the home.

Can I sell an inherited house before probate is finished? Usually yes. With full IAEA authority the executor can sell on the open market during probate; without it, the sale goes through court confirmation with overbidding.

What if the house still has a mortgage? The loan stays with the house. Federal law generally lets inheriting relatives take over an existing mortgage without triggering the due-on-sale clause, or the estate can keep paying it until the house sells and the loan is paid off at closing.

What if my siblings and I disagree about selling? The executor or trustee controls the sale during administration, subject to their fiduciary duties. Once heirs own the house jointly, any co-owner can ultimately force a sale through a partition action - but a negotiated buyout or agreed sale is almost always cheaper.