Articles Posted in Estate Planning

One of the more complicated aspects of estate planning is that while probate, or the process of transferring property upon a person’s death, is normally controlled by Wisconsin state law, most retirement plans are governed by federal law, specifically the Employee Retirement Security Act (ERISA). The ERISA “preempts” or overrides state law to the extent that there is a conflict between the two.

Can You Recover Pension Benefits from a Spouse You Killed?

A common estate planning consequence of the ERISA is that your will or trust does not necessarily control who is entitled to receive any benefits your retirement plan may owe you upon death. Typically, the administrator of your retirement plan will ask you sign a beneficiary designation form. That designation, and not your estate plan, dictates who gets the applicable benefits.

trustee-300x160When you are creating a will or revocable trust as part of your estate plan, you need to think carefully before selecting someone to act as a personal representative or trustee. Many people just go with their nearest relative, such as a spouse or eldest child, but a fiduciary’s role is not ceremonial. An executor or trustee must be financially responsible and demonstrate the willingness to comply with legal deadlines and court orders. Failure to do so can lead to a substantial delay in administering your estate or trust.

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Probate administration in Wisconsin requires the personal representative (executor) of an estate to complete several steps before winding up the final affairs of the deceased. One critical step is filing an inventory with the probate court. The inventory, as the name suggests, is a listing of all property owned by the probate estate. Continue reading

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For many Wisconsin residents, administering a parent or relative’s estate may be their first extended interaction with the legal system. If you find yourself in the position of a first-time personal representative or executor, you may wonder if it is even necessary to hire an experienced probate and trust administration lawyer. After all, if your relative’s estate only has a few assets–maybe nothing more than a house and a checking account–you can surely handle everything on your own and spare the expense of a lawyer, right?

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1222896_coins-sxchu-username-iproleOne reason many Wisconsin residents create a trust is to reduce their estate’s potential estate tax liability. For example, with a qualified terminable interest property (QTIP) trust, married couples can maximize the potential estate tax deduction for their combined property. Basically, the way a QTIP trust works is that the first spouse to die leaves a “life estate” in his or her property to the surviving spouse. This means the surviving spouse may continue to use and receive income from the deceased spouse’s property. The property itself remains in trust until the second spouse’s death, at which time the trust assets are distributed to a final beneficiary, such as the couple’s children.

Wisconsin Court Holds Father’s Will Did Not Create QTIP

Creating a QTIP trust is not necessarily difficult, but it is something that must be done carefully to ensure there is no confusion as to your intentions. If you did not clearly intend to create a trust, do not expect a judge to make one for you after you die just to help your estate save money on its estate tax bill. The law is not that generous.

Here is a recent case in point. Four adult children attempted to sue the law firm that handled their father’s estate more than 30 years ago for malpractice. The children maintained that their father had intended to create a QTIP trust and the attorneys failed to do so after his death, eventually leaving the children with an estate tax bill of over $260,000. Continue reading

Living trusts are a flexible estate planning device that you can amend, modify, or revoke at any point during your lifetime. Of course, once you pass away, the terms of the trust become irrevocable. In other words, your successor trustee is Trustbound by its terms and must administer the trust assets as you direct.

This also means that your choice of a successor trustee is critical in ensuring the successful administration of the trust. Many people create a trust because they fear certain family members gaining control of their estate. Having a strong trustee in place, which in some scenarios may even mean appointing a non-relative or corporate trustee, can help ensure that the trust ultimately fulfills your wishes. Continue reading

Court-HammerProbate administration is the legal process of distributing a deceased Wisconsin resident’s property in accordance with the terms of his or her will, or if there is no will, under the state’s intestacy laws. Probate is also when anyone to whom the deceased owed money can present claims for payment. This includes health care providers, credit card companies, and even family members of the deceased.

Court Dismisses Son’s “Frivolous” Lawsuits Against Mother’s Estat

Under Wisconsin law, a creditor may demand “formal proceedings” in probate court to resolve any disputed claim against the estate. Probate court is the proper place to resolve such issues. In other words, a family member or other creditor should not initiate civil litigation outside of the probate administration process.

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Accuracy is important when making a will. You want to be as clear as possible when identifying your property and the people to whom you wish to leave it. For instance, if your will says, “I leave my son my car,” and you have two sons and three cars, you have not clearly expressed your wishes. Such ambiguity can ultimately lead to costly, unnecessary litigation between your family members as they struggle to understand what you meant.

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Legal Description Helps Court Divide Property Between Niece, Nephew

Even when a court determines that your will was sufficiently clear, dissatisfied family members may still try contend otherwise. Recently, a Wisconsin state appeals court addressed just such a case. This lawsuit revolved around a will that contained a technically inaccurate, though legally sufficient, description of the deceased woman’s real estate. Continue reading

Wisconsin is one of nine states with community property laws that can have a major impact on how couples conduct their estate planning and pass on property to their heirs. The law holds that any property acquired during the course of a marriage is equally owned between spouses and in the event of a divorce, must be split 50/50. Wisconsin is one of a handful of states that take the law further to apply to probate laws.

Married couples in Wisconsin are allowed to have property as survivorship marital property, also known as community property with right of survivorship, which passes on the deceased spouse’s half of the property upon death. What this means is that when one spouse passes away, the house, cars, furniture, and other real estate automatically become the sole property of the surviving spouse.

Wisconsin Statute 766.60(5)(a) reads: “On the death of a spouse, the ownership rights of that spouse in the property vest solely in the surviving spouse by nontestamentary disposition at death.” This law was promulgated in 1986 as part of Wisconsin’s adoption of the Uniform Marital Property Act (UMPA) which sought to create more consistent spousal property laws across the country.

funeralPlanning for your burial is another important part of one’s estate that can often be overlooked when it comes time to planning other aspects like creating a last will and testament, assigning an executor, or creating various types of trusts to avoid tax implications of dividing an estate. However, if you have a family or need to observe certain religious burial practices, it is vitally important that you create an Authorization for Final Disposition to ensure that your final wishes are carried out at your burial.

 

An Authorization for Final Disposition allows individuals to make advance arrangements for their funeral viewing, suggest which religious observances should be followed, and suggest a source of funds to pay for the burial. The Authorization for Final Disposition also gives instructions on what type of funeral ceremony, memorial service, graveside service, or other last rite the individual may desire and inform family members whether a burial, cremation, or other disposition or donation of the remains is desired.

 

Without a signed Authorization for Disposition letter, Wisconsin law provides a hierarchy of surviving heirs who have the authority to make decisions on final burial arrangements. Wisconsin’s order of priority for burial procedures is as follows:

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