When is it legal to gift caregivers in California?
It is important to exercise caution when leaving considerable gifts to caregivers in California if those caregivers are nonrelatives who have assisted you with personal or health care. Before bequeathing such a gift, you should first consult an attorney, and have the attorney sign a statement confirming that you are acting of your own free will, and are not being subjected to undue influence. Under California law, there is a presumption that a bequest made by a dependent adult to a “care custodian” is as a result of fraud or undue influence unless the dependent adult secures a “certificate of independent review” from a lawyer.
A dependent adult over age 65 is someone who is unable to care for him- or herself with respect to physical health, food, clothing or shelter. Such persons are also considered to be dependent if a mental deficit causes them to have difficulty managing their own financial affairs or withstanding fraud or undue influence. With regard to dependent adults under age 65, the mental deficit must result in great difficulty handling their own financial matters or opposing fraud or undue influence.
A certificate of independent review is a statement written by a lawyer declaring that the lawyer has met with the dependent adult when the caregiver was not present, and has concluded that the intended gift is not the effect of fraud or undue influence. The lawyer must not have any legal, financial or other relationship with the caregiver.
If you fail to obtain such a statement, the gift could be rendered void, and the intended recipient will not receive your bequest. The objective of California Probate Code §§ 21380-21392 is to prevent caregivers from exploiting those who are dependent on their services. But without a statement signed by a lawyer, the law could nullify a gift that you genuinely wish to make. For instance, you may want to make a gift to someone who provides you with meals and helps you with living expenses, or you may wish to leave a gift for a caregiver who lives with you, and who has become your friend.
A care custodian is defined as someone who is not a member of your family, and who provides “health and social services” to a dependent adult. The definition does not include individuals who provided services without any compensation if they had a personal relationship with the dependent adult for a minimum of 90 days prior to providing such services, the relationship lasted for a minimum of six months prior to the demise of the dependent adult, and the relationship was in existence prior to the time at which the dependent adult entered hospice care.
In California, the laws apply to gifts in excess of $5,000, as well as to gifts valued at a lesser amount if your estate is worth less than $150,000. The majority of gifts to family members will be unaffected by the regulations, but if your will is challenged, then gifts made to those close to you who are legally unrelated, such as stepchildren or unmarried partners, may be voided.
In the event that a bequest was made to an unrelated caregiver who was compensated, and the dependent adult did not obtain a certificate of independent review, the gift will likely be set aside unless the caregiver can prove by clear and convincing evidence that the gift was not the result of undue influence or fraud.