By: Attorney Gina C. Ziegelbauer
As an estate planning attorney, I see first-hand how proper planning can save major headaches (and potentially money!) for the people you leave behind. But the reality is, many people pass away with no planning in place. So what happens then? What if you die without a Will?
Like so many of my answers, it really depends on your situation. If you die without a Will but all of your assets have payable-on-death, transfer-on-death, beneficiary designations, are held in a Trust, or pass via another non-probate method, those assets get distributed to the listed beneficiaries or via the terms of the Trust or non-probate instrument. In that situation, it is likely that no assets would need to be distributed by the court in a probate proceeding.
Who receives your assets
If you die without a will, and there are assets subject to probate, then Wisconsin statutes decide who receives your assets. This statutory priority system is called “intestate succession.” Intestate succession is state law’s best guess at how most people would want their assets distributed. The default rules might be consistent with what you would want (for example, everything to my spouse, or if no spouse, then everything to my children). But what if you want to include someone else? What if this is your second marriage, or you have children outside your current marriage? What if you are widowed and in a long-term, but non-marital, relationship? Leaving the decision about who-gets-what to the default rules means that there may be unintended consequences.
For example, if you pass away with no spouse and no children, but you have a parent living, intestate succession says your parent receives the inheritance. But what if parent is in a nursing home receiving Medicaid benefits? An inheritance could impact their benefits and result in your money being used for your parent’s care.
Many married couples assume that if one spouse dies, everything goes to the surviving spouse. That is the case if the decedent (person who has died) has no children, or if all of the decedent’s children are also the surviving spouse’s. But, if the decedent has a child or children from outside the current marriage, the default rule says that the decedent’s children receive the decedent’s one-half interest in marital property. Which means that the surviving spouse does not receive everything as they may have assumed. This is another example where the law may or may not be consistent with what you would’ve wanted.
How your assets are distributed and who is in charge
Having a properly executed Will in place also means that you get to decide how your assets are distributed. Intestate succession identifies your heirs and splits your assets into equal shares among those heirs. But maybe you don’t want all of your heirs receiving equal shares, or maybe you want certain heirs to receive certain items of personal property. You could also decide to keep certain heir’s inheritance protected in trust until a certain age rather than receiving everything outright at age 18. Intestate succession does not account for those wishes.
Having a Will in place also means you can choose the person or people in charge of administering your Estate. In Wisconsin law, this person is called your personal representative (also called an “executor”). Without a Will, the court may appoint someone you would not have chosen.
Intestate succession provides default rules if you pass away without a Will. While the default rules are meant to reflect what most people would want, having a Will (along with other planning) in place allows you to have control over your own assets and make decisions that are specific to your situation.
The information in this article is specific to Wisconsin law and general in nature. It is not intended to be legal advice. Gina Ziegelbauer is an estate planning and elder law attorney at Steimle Birschbach, LLC, a law firm with offices in Sheboygan and Manitowoc.