PROBATE What is probate? Probate is a court-supervised process with three goals: 1) to transfer a deceased person's assets to the legal heirs or beneficiaries; 2) to determine and pay federal and Wisconsin estate and income taxes; and 3) to determine creditors' claims. This process protects the rights of any surviving spouse, creditors and beneficiaries of the estate. It ensures that once property is transferred to heirs or beneficiaries, it is free from any creditors' claims (including claims based on medical assistance recovery laws) and any liens for estate or income taxes. There are several different types of probate proceedings, depending upon the size and complexity of the estate. "Formal" administration is supervised by the probate judge while "informal" administration is supervised by the Register of Probate. How long does probate take? This depends upon the size and complexity of the estate. A small estate could possibly be settled within six months. Large or contested estates may, with an extension approved by the court, take two or more years. How long probate takes depends mainly upon the size of the estate, the type of assets owned, the form of ownership, the complexity of creditor's claims, and whether a business is involved. Estate and income tax planning and marital property issues also may affect the length of the process. If the estate is not closed within 18 months - unless an extension has been granted, the court may replace the personal representative or the attorney for the estate, or both. What is a personal representative? A personal representative (referred to as "executor" in many states) is an individual or corporation named in a will or appointed by the court to oversee the probate of an estate. The main duties of a personal representative are to: identify and collect the assets of the deceased; manage the assets during the administration of the estate; determine the rights of any surviving spouse under marital property laws; pay expenses of administration, taxes, debts and claims; and distribute the remaining assets to those entitled to receive them. Are you required to have an attorney to probate an estate? In a formal probate proceeding, it is necessary to have an attorney to represent the personal representative. In other types of probate, an attorney is not required. The staff of the county Register in Probate can help you obtain the correct forms. However, they cannot evaluate your case from a legal perspective or advise you regarding the many technicalities that often come up during the probate process. How are attorneys paid for probate matters? The fees charged in probate matters vary from attorney to attorney. Lawyers may charge on a percentage, hourly or fixed-fee basis. Those who charge hourly keep records of the time spent and of out-of-pocket expenses. Attorney fees must be approved by the judge in formal probate proceedings. Before retaining an attorney, it is important that you clearly understand the fee arrangement. Does probate involve any tax considerations? Yes. Federal and Wisconsin estate and income tax planning may be involved in an estate. The size of the estate may not be what determines the tax decisions to be made. You should discuss probate-related tax issues with a lawyer. How are estate taxes determined? Federal and Wisconsin estate taxes are applied to the taxable value of a person's total property at death, including property that does not go through probate. The personal representative must pay these taxes from the estate within nine months of the date of death. In general, there are no estate taxes due on property distributed to a surviving spouse. Can you avoid probate? You may avoid probate in certain instances. For example, no probate is necessary if the total of individually owned property is no more than $20,000 in value. Property titled in joint ownership or in a "living" trust is not subject to probate. However, even though probate is not required, you may have to report and pay federal (and possibly Wisconsin) estate taxes. You may need the assistance of an attorney for this purpose. (This information is intended to be viewed as general information. Your individual situation or needs require consultation with the advice of an attorney. Please call or e-mail Leo Beskar regarding your particular situation, questions or concerns.)