Here are some frequently used Wisconsin estate planning terms.
Will or Last Will and Testament: A will allows an individual to transfer assets after death. The client can designate a personal representative who will administer the estate.
Trust or Living Trust: Trusts are used to minimize estate taxes and avoid the probate system. Trusts allow for a quick transfer of assets to the beneficiaries. Various forms of trusts can be tailored for your specific needs.
Living Will: Allows you to create specific instructions if you are in an end-state illness or vegetative state.
Power of Attorney for Health Care: Allows the client to designate their health care agents.
Financial Power of Attorney: Designates the financial representative for the estate and grants them specific power.
Final Disposition Letter: Determines what happens to you remains and allows the client to donate organs for specific causes.
View Frequently Asked Questions about Wisconsin Estate Planning here.
What is a Probate?
The court process for transferring property from a deceased person to living people is known as Probate. The process is used whether a person died with a will (testate) or without a will (intestate). A probate case in court is necessary in Wisconsin when a person dies leaving at least $50,000 of probatable assets. Probatable assets are property that is not transferred automatically upon the death of the owner. Examples of probatable assets are bank accounts with no joint owner or pay-on-death (POD) beneficiary, real estate held solely in one person’s name, or held “in common” with someone else, automobiles, artwork, collections, furniture, farm equipment, and all other personal property.
If all of the decedent’s assets were owned in a Living Trust, there is no need for Probate. Then, the assets are distributed using Trust Administration (see below).
The probate court is administered by the County Register in Probate. When a person dies in Wisconsin, an application for probate is filed with the Register in Probate. If there is a will, it will be filed and proved.
All interested parties must be informed of the proceedings and a notice must be published in the local paper. Interested parties will have a chance to challenge the will. Any person or business owed money by the decedent must have a chance to make a claim against the estate.
If there is a valid will, the choice of Personal Representative and the distribution of property is controlled by the will. If there is no will, the Court will decide who to appoint as Personal Representative, and the Wisconsin law will determine who will receive the property. For a summary of the rules of inheritance, the court appoints a Personal Representative (also known as an Executor) to collect and distribute assets and pay debts. The Personal Representative must make an inventory and account for all property that is part of the estate.
When all of the assets are accounted for and inventoried, the court collects a fee equal to .2% of the estate ($2 per thousand). Then the debts of the decedent and the estate must be paid and finally what is left over may be distributed to the heirs.
Once the distribution is complete, the Personal Representative provides the heirs and the court with a final accounting and a closing statement, and the probate is closed.
Wisconsin Rules for Intestate Succession
Wisconsin Rules For Intestate Succession If a person dies leaving no will, the following is a summary of the rules for distributing their assets.
- Everything to the spouse (but see the exceptions below)
- If there is no spouse, everything to the issue, per stirpes. Issue means direct descendants including children, grandchildren, etc. Per stirpes means that everything goes to the children, if they are all living, with nothing to the grandchildren. But, if Child #1 of the Decedent has passed away, the children of Child #1 (the grandchildren of Decedent) get to split Child #1’s share.
- If no spouse or issue, everything goes to the parents.
- If no spouse, issue or parent, then to the siblings or their issue, per stirpes.
- If no spouse, issue or parent or issue of parent, to the grandparents or their issue, per stirpes, one half on the mother’s side and one half on the father’s side.
- If there is no person described above, then the Wisconsin School Fund gets the property.
If the Decedent had children that were not children of the spouse (pre-spouse children), those children split the estate with the spouse. Subject to the spouse’s right to keep certain household property and an automobile, the pre-spouse children receive all of the Decedent’s interest in marital property and property held by the Decedent and spouse as tenants in common. The pre-spouse children also receive half of the Decedent’s interest in individual property.
The spouse receives all interest in real estate held as husband and wife as joint marital property.
If you have a case that involves pre-spouse children, it is often a very good idea to get an attorney involved very early to make sure assets are divided according to the law.