What Is Probate?
Probate is a term most people have heard, however not everyone fully understands what role the probate court plays in terms of administering an estate after an individual’s passing.
Probate is simply the court process where a Will is proven valid. Probate is also needed when an individual dies intestate (without a valid will). After a Will is proven to be authentic, an orderly process is followed to finalize the affairs of the decedent as they are detailed in the Will.
In the vast majority of cases, the decedent’s wishes are carried out in the following order after a Will is validated (or certified) by a probate court –
- Collecting the decedent’s assets
- Liquidating liabilities
- Paying necessary taxes
- Distributing property to heirs
Every estate in Wisconsin goes through probate. Wisconsin has a unique set of laws related to the probate process of a Will and the same is true for every state. Sixteen states follow the Uniform Probate Code (UPC), designed to simplify the process. States following the UPC include Alaska, Arizona, Colorado, Florida, Hawaii, Idaho, Maine, Michigan, Minnesota, Montana, Nebraska, New Mexico, North Dakota, South Carolina, South Dakota, and Utah. The other 34 states, including Wisconsin, have adopted some part of the UPC but still retain distinct probate procedures.
Why We Probate A Will
The general rule is a Will has no legal effect until it is processed through probate court. Because a Will has no legal standing it is a good practice to have a Will probated immediately so no one has a right to suppress it. This is not often a problem because the person in possession of a Will is usually a personal representative of the deceased or the decedent’s attorney.
The law also compels whoever is in possession of the Will to present it to the probate court. There are statutes imposing penalties for not producing a Will within a specified time, concealing or destroying it.
Probate proceedings are usually held in the state in which the decedent lives (or has permanent residence at the time of death). However, if the deceased owned real property in another state, the Will disposing of these assets must also follow the probate process in that state.
For a Will to qualify in probate, the instrument must be of testamentary character (and comply with all statutory requirements). A document is testamentary when it does not take effect until after the death of the person making it and allows the individual to retain the property under personal control during her/his lifetime. A properly executed Will by a competent person (the testator) as required by law is entitled to be probated, even if some of its provisions are invalid, obscure, or cannot be implemented.
A Will that has been altered, is fraudulent or has been made as a result of undue influence, will be denied probate. If there are alterations to specific provisions within a Will in which certain provisions are revoked, remaining provisions can be admitted to probate.
Avoiding Probate Court In Wisconsin
The probate process ends the decedent’s interest in property titled in his or her sole name while vesting titled in the named beneficiaries (as named in the will), or to the decedent’s heirs if there is no will. As importantly, it protects those receiving assets from future claims by –
- Giving notice to creditors
- Providing a forum and process for the decedent’s debts to be paid
- Establishing a deadline by which all claims against the estate must be made
Probate processes vary in complexity and can be costly and time-consuming. To avoid unneeded expense, many people try to avoid having assets pass through the probate process. An experienced estate planning attorney can assist in navigating through the process by planning ahead to minimize or eliminate the need for probate court.
Below are a few of the assets that do not go through probate in Wisconsin –
- Assets with beneficiary designations, such as –
- Life insurance
- Retirement accounts
- NOTE: if your “Estate” is named as the beneficiary the asset must to go through probate
- Assets titled as joint tenants with other person(s)
- Survivorship marital property
- Property titled in a revocable trust
- Assets with a “Pay on Death” (POD) or “Transfer on Death” (TOD) designation (which can include real estate)
- Property transferred under a marital property agreement
- Additionally, in Wisconsin if the decedent has assets with a total value of less than $50,000.00, probate can be avoided by drafting what is called a “transfer by affidavit.” This is true even if the individual had a will.
What Is Better – Probate Or Intestacy?
The condition of intestacy, an individual has died without having prepared a valid Will. When there is an “intestate estate”, the probate process will focus on the deceased individual’s property being distributed according to statutes, primarily by the law of descent and distribution and others dealing with marital property and community property (all going to a surviving spouse).
Approximately 70% of Americans pass without a Will, using state statutes to distribute their property. If you do not agree with how the statutes will distribute your property after you die, creating a valid Will or assigning your assets to people upon your passing are the only ways to ensure the people you choose receive the assets you want them to have.
If you want to learn more about the probate process, creating a Will, Estate Planning or Trusts, Contact Tom Johnson at Elliot, Monahan & Johnson at (608) 362-8086 or send us an email, we’ll be happy to help you identify the right options for your circumstances.