No. Any power of attorney terminates the moment a
person passes away. Any bank or investment account will
likely be closed or frozen the moment they find out about
the death. You will not be able to withdraw funds or even
deposit a check. You must provide proper documentation
that you are in charge of the estate.
Most of the time we can use a process called informal probate. There are numerous
forms that must be completed in order to get the
probate started in court and have you appointed as Personal
Representative (PR). It is not enough that you were
named PR in the Will. We also must notify every heir and
give them a copy of the Will. We will need to continue to
file documents with the court and give copies to all heirs
throughout the process. Before you can do anything with
the estate, you must be issued Domiciliary Letters from
the probate court. This is what gives you authority to act
on behalf of the estate.
Because your loved
one did advanced estate planning and used a Trust, your
job will be easier as a Successor Trustee than it would be
if they used a Will. There are differences in settling a
Trust. 1) A lot of the ground work has been done for you.
If the Trust was properly set up and funded, we already
know what assets exist and where to find them. 2) We do
not need to do anything through probate court, which
means we will save time on filling out endless forms. We
do not need to do things on the court’s schedule and the
settlement will remain completely private. 3) The attorney
fees will only be about half as much. 4) We do not wait
for court appointment through Domiciliary Letters. Instead
we can complete the Affidavit of Successor Trustee
and you can start using the checking account.
We strive to make it a quick and
easy process for you. Our goal is to complete all settlements
in 9 to 12 months. However, a lot of things are out
of our control. For example, if we need to cash in an investment
account and the company will not work with us,
this will slow down the process. Depending on what time
of year someone passed away, taxes might hold up closing
the estate. If we find assets after we thought everything
was accounted for, it will delay the process. If a home
needs to be sold and there are no buyers, it will delay the
process.
The first stage
in the settlement process is gathering all of the decedent’s
financial information. Look through all paperwork at the
house for account statements. If there is a safe deposit box,
look through that for any important information. Find last
year’s taxes and bring them to the office. Often, accounts
we didn’t know about will trickle in as notices come in the
mail. Pay attention to the mail you’ve had forwarded to
your house and don’t assume anything is junk mail. A
statement could come notifying us of an account we did
not know existed. The second thing to do is to set up a new
estate checking account using the estate EIN. Once this is
set up, you can start cashing checks and paying bills. As
the appointed PR or Trustee, it is your responsibility to
make sure bills are paid, taxes are paid and the home is
taken care of.
If you feel comfortable filling
it out, you can do so. However, the forms can be confusing
and ask for information you might not have on hand. As
part of the settlement process, we are happy to complete
any claim forms or assist you with any questions you have
in completing this paperwork. We will work with you to
make sure all insurance and proceeds are collected.
Wisconsin estate recovery must be notified
if assets are transferring through any probate process.
If everything is being done through a trust, there is currently
no obligation to notify the state. However their rules
state they can still recover. We will take care of notifying
the estate recovery division if necessary.
There are two options. First, the inheritance can be given
to the beneficiary as written in the will or trust and they
can then gift it to their children or other beneficiary. The
downside to this distribution is that it will be considered a
gift for tax purposes. The second option is to “disclaim”
your inheritance. To do this you need to speak with us.
The downside is that your portion of the inheritance must
go as directed by the will or trust. The upside is that there
will not be any gift tax consequences. You can also choose
to disclaim a portion or all of your inheritance.
Don’t give anything
away until you consult with us. Anything with a
beneficiary designation or POD will go directly to that
person, although sometimes the “person” listed is actually
the trust. One of the goals of the settlement is to
cash in all the various savings accounts, investments,
insurance policies, etc., and have everything deposited
into the estate checking account. This is a good idea
because it gives us an idea of what funds are available. It
also means funds are available to pay expenses. Once
we’ve had a chance to talk, it’s likely we can advise you
to do a preliminary distribution. This allows you to distribute
some funds but ensures you keep enough assets
in the checking account to continue to pay expenses.
There is a distribution process that requires each beneficiary
to sign a receipt, so you should talk to us before
you start writing out checks.
Most trusts
and wills indicate the PR or trustee is allowed to collect
a reasonable fee for their services, in addition to their
inheritance. There is also a state statute that says you can
collect a fee as personal representative. The document
might specify a percentage you can collect. If it says a
reasonable fee, our office will help determine what that
amount would be. On top of getting a reasonable fee for
your service, you can always be reimbursed for any out
of pocket expenses. While you should use the estate
checking account as much as practical, some things will
come up before that is set up. Keep a detailed account of
everything you spent out of pocket and how and when
you reimbursed yourself.
We do not charge by the hour or
by a percentage of the estate like most law firms. At our
first meeting, we will discuss our fee schedule and give
you an estimate of how much it will cost. Typically, the
same things that cause a settlement to take longer will
also cause it to cost more. Numerous beneficiaries, numerous
accounts, and a lot of real property will raise the
price. A probate administration will always cost more
than a trust administration. The probate court will also
collect an inventory fee, which is separate from the attorney
fee. If the decedent had property located in another
state it will likely slow the process and increase
the cost.
Robert A. Ross is an estate planning attorney and counselor with offices in Northeastern Wisconsin. He is a certified Estate Planning Law Specialist and an accredited Estate Planner. He provides Business Succession Planning, Charitable Giving options and Retirement Planning. He is a member of the State Bar of Wisconsin, WealthCounsel, and the Wisconsin Council of Estate Planning Attorneys. Robert A. Ross received his B.S. from St. Norbert College and his J.D. from Marquette University Law School.
