There is a trend to try and avoid probate at all costs. Yet probate need not be feared, and avoiding probate is not always advised. Here are three situations (here may be more) where you should at least consider probate.

1. Cost. There are costs to probate, but those are incurred after your death. Although trusts are a great way to avoid probate, they come with an upfront cost that may be too much for you while living. Spending money now means it will not be there for you down the road. You may benefit from keeping your hard-earned money for your use while you are living. In addition, trust administration is not automatic or free. There will still be cost your trust bears after your death, although they are often less than the cost of probate.
2. Medicaid. If you are married and your spouse is receiving Medicaid benefits, then probate is necessary to help protect the Medicaid benefits in case you die before your spouse. Probate in this scenario is worthwhile because it helps preserve your spouse’s Medicaid benefits.
3. Family dynamics. Some families benefit from a referee. Going through probate allows the court to make sure things run smoothly and give your heirs easy access to the court to settle disputes. A trust, by design, is meant to be private. There is no oversight of the trustee by a third party.

As with all estate planning, there is no one-size-fits-all plan. Each person has particular goals and desires. Each family has its own unique relationships and history. If someone tells you that you “must have a trust” or “no one should go through probate,” you should get a second opinion. Contact our office today to schedule your initial consultation or to have your current plan reviewed. We look forward to meeting with you.

Often people want to make the transfer of their estate as easy as possible. This usually means avoiding probate is their main goal. To avoid probate, many people record a Transfer on Death Deed for their real estate (“TODD”). A TODD works like a beneficiary on a financial account. When the owner of the real estate dies, the real estate is immediately transferred to the beneficiaries named on the deed.
Although  a TODD can transfer real estate very easily, you should proceed with caution. Transferring things with ease does not always mean that things will be easy for those who receive the real estate. So, what could possibly go wrong with a TODD? I’m glad you asked. Here are three things you should consider:

• Refusal to sell. I have had families come to me after Mom or Dad’s death to deal with a sibling that refuses to sell the real estate Mom or Dad left to the children via a TODD. At the time, Mom or Dad thought it would be easy to leave their real estate to their kids by using a TODD. Probate would be avoided. The transfer would be easy. What they didn’t anticipate is what happens after that easy transfer.

By using a TODD deed, Mom or Dad created a situation where the real estate was immediately owned by multiple people. Multiple owners have all the same rights to the property, so all of the owners have to agree on the listing agent, listing price, negotiations, final sale price, etc. This opens the door for disagreement. There are better options to avoid this outcome.

• Death of a Beneficiary. There have been times where a beneficiary of a TODD died before Mom or Dad, and the TODD remained unchanged. This opens the door to owners of the real estate who were not intended (usually the children of the deceased beneficiary). Now, the property Mom thought would be owned by her children is owned by grandchildren, too. Creating more owners and decision makers.

• Transfers to Widow. It is not uncommon for Mom or Dad to name a child and their spouse as “joint owners” on a TODD. While this makes Mom or Dad happy to see an in-law treated as family, it does cause potential issues. If the child predeceases Mom or Dad, the widow will take ownership at Mom or Dad’s death. This can result in the property being controlled by someone who may have no connection to the family or may remarry and make their property interest part of their new estate plan, with their new spouse, risking the family property from staying in the family.

As you can see, just “leaving things to the kids easily” does not always mean things will be easy once the property has been transferred to the kids. Before you record a TODD, please contact us to schedule a consultation to discuss whether the TODD meets your estate planning needs.

Sometimes clients want to avoid probate so badly they overuse beneficiary designations and inadvertently destroy their wishes. Realizing the impact beneficiary designations have on your goals and plan are important considerations we discuss with our clients. 

Follow this link to a good article discussing potential pitfalls.

A recent case in the news, namely the handwritten will of music superstar Aretha Franklin, raises the question of whether or not a person living in Wisconsin can do a handwritten will. In the Franklin case, a jury in Michigan had ruled that a handwritten note from the late singer was a valid will.

In 2019, Aretha Franklin’s niece had found three handwritten documents scattered about the singer’s home near Detroit.  One, dated 2014 was found underneath the couch cushion.  There was another, earlier note from 2010, which had been found under lock and key in the singer’s home.  And finally, a more recent will which changed some of the language in the earlier documents. 

Apparently, the documents themselves were difficult to read; but the jury concluded that the 2014 note had her name signed at the bottom, with a smiley face written inside the letter “A”, which was apparently typical of her actual signature. 

The Franklin case deals with what is known as a “holographic” will, meaning that it is handwritten by the maker, but does not require witnesses.  These Franklin wills also highlight the problems associated with these holographic wills.  Such wills are valid in some states, but not in Wisconsin.  In Wisconsin, a handwritten will may be deemed valid, but it still requires the date of the will and signature of the maker, as well as signing in front of two disinterested witnesses, who also simultaneously sign the document.  These safeguards are viewed as essential to ensure the validity of the Last Will and Testament.  Even better would be to have the will drafted by a competent attorney and executed with the statutory formalities. 
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Here at Grosskopf & Burch, we have experience in drafting wills, trusts, and other estate planning documents, and also have experience making sure they are properly drafted, executed, witnessed, and later filed with the Court if necessary. 

May has been designated as Elder Law Month by the National Academy of Elder Law Attorneys.  Both Peter E. Grosskopf and Aric D. Burch are members of the National Academy of Elder Law Attorneys and invite you to learn more about the practice of Elder Law.  Elder Law has changed over the years.  It used to be thought of as simply dealing with preparation of documents for our seniors, such as Financial Powers of Attorney or Healthcare Powers of Attorney.  Since that time, it has become a larger part of the legal landscape.  At a time when Estate and Inheritance Taxes have become nonissues for a great many people across the country, the legal issues facing our elderly have increased many times over.  For example, “Elder Law” can include many such things, including:

• Planning for Medicare;
• Planning for Medicaid, which is that part of the government that can pay for long term care in nursing homes, assisted living, or even in home care;
• Estate Planning and Probate, and ways to avoid Probate;
• Guardianship or Conservatorship;
• Asset Management;
• Financial Powers of Attorney or Healthcare Directives;

Even with Financial Powers of Attorney and Healthcare Directives, for most situations, the simple, free documents that exist are simply inadequate to deal with the reality of planning or qualifying for Medicaid or end of life health issues or financial management.  Joint bank accounts can be a trap for the unwary, misinformation about “Medicaid Spend Down”, and Medicaid’s “Five Year Lookback” are found everywhere. 
That is why it is important to make sure that you are dealing with a qualified Elder Law Attorney such as the attorneys here at Grosskopf & Burch.  We look forward to meeting with you and assisting you with your needs, now and in the future.
For more information about the advantages of hiring an Elder Law Attorney, please see the article "Why Hire anwww.elderlawanswers.com/why-hire-an-elder-law-attorney-19642 Elder Law Attorney?"

Whether your spouse has just passed away or you have lost your mom or dad, the emotional trauma of losing a loved one often comes with a bewildering array of financial and legal issues demanding attention. It can be difficult enough for family members to handle the emotional trauma of a death, let alone taking the steps necessary to get these matters in order.

Often times, you must go through the probate process. If there is no estate because there is a trust, and you are named as the trustee, the process will be different based on the trust document's specific instructions. In that case, it is recommended you meet with an attorney to make sure you know your obligations and liabilities as trustee.

I want to focus on probate for this post. If you are the personal representative of the will, you first should secure the tangible personal property, meaning anything you can touch such as silverware, dishes, furniture or artwork. Then, take your time while bills need to be paid. They can usually wait a week or two without any real repercussions. It is more important that you and your family have time to grieve. 

When you are ready, you should meet with us to review the steps necessary to administer the will and go through probate, which may include

• File the will and petition in probate court in order to be appointed the personal representative.
• Collect the assets. This means that you need to find out about everything the deceased owned and file a list of inventory with the court.
• Pay the bills and taxes. If an estate tax return is due, it must be filed within nine months of the date of death.
• Distribute property to the heirs. Generally, personal representatives do not pay out all of the estate assets until the period for creditors to make claims runs out in order to make sure the estate has sufficient assets to pay all claims.
• Finally, you must file an account with the court listing any income to the estate since the date of death and all expenses and estate distributions.

If you are inclined to go through probate on your own, you can find helpful information at the Wisconsin Register in Probate web site (here) or on the Wisconsin Court System's self-help website (here).

4 Reasons to Consider a Custom Financial Power of Attorney

We all want to save time and money when possible. So, when clients ask me if pulling a generic power of attorney form off the web, like the standard Wisconsin power of attorney for finances, will work, I understand the motivation to put a crucial document in place quickly and economically. A generic form is valid and will give your agent certain powers to manage your finances. However, they do have limitations to be aware of.
Often a generic form will lack provisions that may be necessary for making complex financial decisions to ensure your plan is carried out. We often face navigating more complex financial situations when planning for Medicaid. You should consider the following four factors before using a generic form.

• No Ability To Create Trusts. A generic power of attorney for finances will allow your agent to deal with trusts you have already created, but it will not authorize your agent to create new trusts. A trust may need to be created as part of your estate plan, especially if you desire to protect assets. Medicaid planning routinely uses trusts to protect your assets. A custom power of attorney for finances can allow your agent to create irrevocable trusts, special needs trusts, or pooled-trust accounts (e.g., Wispact) for you.

This trust-creation ability for your agent can be vital, especially when dealing with special needs planning. If the power of attorney document doesn’t allow your agent to create certain trusts, a guardian must be appointed to carry out that task.

• No Ability To Change Beneficiaries. Changing beneficiaries on life insurance, annuities, or retirement benefits is sometimes necessary to adjust your plan to life’s changing circumstances, especially when undertaking Medicaid planning. A generic power of attorney for finances will allow your agent to do many things related to those types of assets, but it will not allow your agent to change beneficiaries. Your beneficiaries may need to be changed to avoid leaving assets to someone who cannot receive assets due to being embroiled in a divorce or going through bankruptcy. Special needs planning also makes flexibility with beneficiary designations vital. In addition, some assets must have the State of Wisconsin listed as a beneficiary in order to qualify for Medicaid. Not having the ability to make that change may prohibit receiving benefits you may need. A custom power of attorney would authorize your agent to make those necessary changes.
• Limited Gifting. When conducting Medicaid planning, it is often necessary to make gifts to achieve certain goals. A generic power of attorney will limit your agent’s ability to make gifts by requiring gifts to be less than the annual gift tax exclusion (currently $17,000). Although this limitation helps protect you from your agent making excessive gifts, it may limit your ability to engage in Medicaid planning.

 When engaging in Medicaid planning, it is often desirable to make gifts in excess of the $17,000 exclusion. A custom power of attorney for finances can provide both flexibility and protection. It can limit your agent’s ability to make gifts under normal circumstances to a maximum amount and provide an exception to allow your agent to make larger gifts under certain circumstances, such as Medicaid planning.

• No Ability To Classify Property. For a married couple in Wisconsin, the ability to classify property as individual or marital is a key component in Medicaid planning. A generic financial power of attorney form does not provide your agent with the ability to enter into any type of marital property agreement. To properly plan for Medicaid, a married couple should have the ability to classify or re-classify property. Even some custom powers of attorney limit the types of marital property agreements that can be entered into, so you should have an experienced elder law attorney review or draft the power of attorney to ensure the necessary powers are given to your agent.

Sometimes life can be more complicated than we prefer. While there is a time to simplify things and to be thrifty, when dealing with the uncertainties of life and management of your assets, it is preferable to pay for professional services to make sure your agent can do everything necessary to make sure your plan remains in order and you receive the care you need. Before you download a generic form and call it a day, schedule a consultation with us to discuss your own custom financial power of attorney.

Nearly as important as creating the trust is the concept of "funding the trust." The trust itself is the "vehicle" for your assets; your assets are the "passengers" and must get into the vehicle in order for the trust to do its job properly. If you don’t properly fund the trust, your assets may have to go through Probate, simply to get into the trust!  That can defeat some of the purposes for creating a trust.
            For Real Estate, this means that deeds need to be prepared and properly executed for transferring ownership of real estate into the trust.  Some people prefer not to record the deeds during their lifetime for a variety of reasons.  This is acceptable, but we do recommend that the deeds be prepared and be in recordable form.  However, sometimes original documents are misplaced or accidentally destroyed; keep this in mind.  For vehicles, the same is true.  Titles should be prepared in assignable form so that they can be immediately transferred to the trust.  Again, some people, for convenience, prefer not to make the actual conveyance through the motor vehicle department during their life. 
            You should be sure to have your Bank Accounts, Stocks and Bonds, properly transferred so that they are in your trust.  Most bankers and stockbrokers are familiar with this process and can assist you in making these transfers, as appropriate. 
            In addition to transferring assets at the time of creating the trust, it is important that any assets received later should likewise be transferred, or funded, into the trust.  For example, many people will change the vehicle that they own, many times.  It is important that not only the first car that you have, or car that you own at the time of creating the trust, be placed in the trust, but likewise that any replacement vehicles be properly titled or funded into the trust.  So should you receive assets from some other source (gift, inheritance, earnings, etc.) they should likewise be funded or titled in the trust. 
            The proper title for any of these assets would be, for example:  "John A. and Jane A. Smith, trustees of the John A. & Jane A. Smith Trust dated December 31, 20XX, or its successor trustee."
             As described above, the Marital Property Agreement, if appropriate, can fund assets into the Trust, at either the death of the first spouse, or the second spouse.  The advantage of funding by way of the Marital Property Agreement, verses a Pour Over Will, is that the Marital Property Agreement does not have to go through probate, whereas a Will does. 
If you have questions regarding your Trust or any elements of your Estate Plan, please contact our office.