Monday, December 28, 2009

Probate in Wisconsin - Estate Taxes

By John DiMotto

There was an interesting article in the New York Times this morning about the federal estate tax. The general import of the article is that people of more modest means will be hurt by it come 2011. While I do not dispute that for some it will be a quandry, in the Milwaukee County Probate court where I serve, I rarely see the negative effects of the federal estate tax.

There are many ways to transfer property as nonprobate property. POD (payable on death) accounts, TOD (transfer on death) deeds, Affidavit of Transfer (in small estates), and, for the more wealthy, Trusts.

Trusts are very interesting instruments. They are a way to control the passage of one's estate to maximize "keeping it in the family" and reduce tax liability. And, they can be very complex.

I recently reviewed a series of interrelated trusts which, in length, made "War and Peace" seem like a short story. They clearly were set up to address the federal estate tax laws and its ramifications. I had to read them over several times in conjunction with the Petition in the case in order to grasp their import. Suffice it to say, this case will be challenging.

What I have learned, first and foremost, in my probate assignment, is that no one should take their life or their death for granted. Everyone should have an "instrument" to govern how their property passes upon death if you really want to look out for your heirs and loved ones.

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