Probate is the court-supervised process in Wisconsin through which the assets from an estate are distributed. There are both Formal and Informal Probates, the formality dictates how involved the Court is in the process. This process can be lengthy and complicated or it can be short and smooth; there are steps that can be set up to ensure the process is the latter.
Unfortunately, many Wisconsin families are not aware of those steps or are held back by misconceptions about probate. An experienced estate planning lawyer can assist with the steps needed to make the time after a death easier for the family. This post can help clear up the most common misconceptions about Wisconsin probate proceedings.
Myth 1: Every estate goes into probate
Most estates are subject to probate. During the probate process, creditors have three months to file claims against the estate. There are also income taxes to file; the exact details of income tax filings depend on the estate.
However, there are some estates that do not go through the probate process. If the amount of the estate is under the Wisconsin threshold, the estate is not subject to the probate process. Some assets in an estate may not be subject to probate.
Myth 2: There is no way to avoid probate
As discussed above, not all estates are subject to probate. Even if an estate is going through the probate process, not all assets in the estate may be part of the process. These assets may include accounts with a beneficiary designation, assets included in a trust, or property that is jointly owned. In a joint ownership, property automatically passes to the second party named in the joint ownership.
It should be noted that accounts are only excluded from probate IF the owner has specifically named beneficiaries. This is one of several estate planning steps that can make the process easier for friends and family members after a death.
A revocable living trust is another way to make the distribution of assets smoother during a difficult time. Certain items of the estate are placed into a revocable living trust; the “revocable” label means the trust can be revoked at any time. There are three parties named for management and distribution of the assets: a settlor, trustee, and beneficiary (or beneficiaries). The settlor is the individual who owns the assets. The trustee manages those assets when the guarantor is alive or becomes unable to do so. The beneficiaries are the parties designated to receive those assets. A trust can be established with the assistance of an experienced estate planning lawyer. Even with a trust, a will should still be drafted to detail the distribution of other assets not included in the trust.
Myth 3: During probate, the court is responsible for every part of estate distribution
This common estate planning myth is partially true. Probate is a court-supervised proceeding, but the distribution of assets is executed by a personal representative usually named in the will. If a personal representative is not named in the will, the court appoints an executor.
The will can designate any party as the personal representative. The personal representative can be a friend, family member, or organization. A personal representative can also consult a lawyer to assist with the process. The personal representative is charged with compiling a list of assets, managing creditor claims, and distributing assets. Because this is a multi-step process, the probate process may take a year or more.
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