Wells Fargo Bank NA v Maria G Romero

Probate Notes: Appearances required. The following is noted for the Court at the hearing: High Reserve.

Petitioner initially requested $10,000 for a reserve amount, then reduced that request to $5,000. The stated reason for the request is a property tax reassessment. Petitioner admits the amount of the property tax reassessment can be roughly calculated, and professional fees roughly estimated, so there is no need to hold a reserve when those fees can be paid in advance.

The point of an order for Final Distribution is to close out an estate and cease court oversight. A large reserve amount creates a presumption that the estate is not in a condition to be closed, and a second final accounting must be performed to ensure the proper distribution of funds to the heirs/devisees.

The following is from a well-respected treatise on this issue: Although not required, it is advisable to include an estimate of closing expenses. Examples of estimated closing expenses include any estate taxes, interest, and penalties that will be paid after distribution; the cost of preparing final income tax returns for the estate; the cost of transferring securities to the distributees; the cost of reasonable storage, delivery, and shipping for distribution of tangible personal property to the distributees; and the cost of certifying and recording copies of the decree of distribution of real property. See Prob C Sec.Sec.11642, 11750, 11753-11754.

Some courts require more detailed information about the nature and amount of the anticipated closing expenses. See, e.g., San Francisco Ct R 14.35(I)(3). The personal representative may also wish to retain funds for any undisclosed or unknown liabilities, especially tax deficiencies later assessed against the decedent or the estate.

Apart from the reserve for estate taxes, there are some drawbacks to setting the reserve aside specifically for possible future tax deficiencies. Such action indicates--especially if the reserve is a substantial one--misgivings about the validity of the estate's position. The reserve might also be considered a trust fund for payment of the taxes, thus extending the statutory period for assessment. See U.S. v Rose (3d Cir 1965) 346 F2d 985, 989.

In addition, if the personal representative requests that the court allow for a substantial reserve (or even a reserve of more than $5,000), some courts will refuse to characterize the distribution as "final" and will require additional accounts (or waivers) before permitting distribution of any balance of the reserve. For example, in Contra Costa County, the court will not characterize the distribution as final if the personal representative requests more than a nominal reserve. If the entire estate will be distributed to a single beneficiary, such as a trust established during the decedent's lifetime, a reserve may not be necessary. (Cal. Dec. Est. Pract. (CEB 2023), Sec.31.66.)

Accordingly, it is recommended the Court deem this estate not to be in a condition to be closed, or require a second final accounting and petition for distribution be set a reasonable time after the tax liability is due.

Tentative Ruling: Wells Fargo Bank NA v Maria G Romero Tentative Ruling: Wells Fargo Bank NA v Maria G Romero Case Number

Case Type Limited Rule 3.740 Collections (09) Hearing Date / Time Thu, 07/16/2026 - 08:30 Nature of Proceedings Motion: Judgment on the Pleadings Tentative Ruling /media/2158