Wisconsin does not have a state inheritance or estate tax. However, like every other state, Wisconsin has its own inheritance laws, including what happens if the decedent dies without a valid will. We’ll discuss what Wisconsin has to say about that situation, along with details about the probate process and how to successfully create a valid will in Wisconsin. If you want professional guidance for your estate planning, SmartAsset’s free financial advisor matching tool can pair you with up to three advisors who serve your area.
Does Wisconsin Have an Inheritance Tax or an Estate Tax?
Wisconsin does not levy an inheritance tax or an estate tax. However, if you are inheriting property from another state, that state may have an estate tax that applies. You will also likely have to file some taxes on behalf of the deceased.
If the estate is large enough, it might be subject to the federal estate tax.
Other Necessary Tax Filings
When you die, there are many tax situations that need to become a priority for those who survive you. You need to look out for the following:
- Final individual federal and state income tax returns – The federal and state tax returns are due by Tax Day of the year following the individual’s death
- Federal estate/trust income tax return – Due by April 15 of the year following the individual’s death
- Federal estate tax return – Due nine months after the individual’s death, though an automatic six-month extension is available if asked for prior to the conclusion of the nine-month period
- This is required only of individual estates that exceed a gross asset and prior taxable gift value of $12.06 million in 2022
To file any of these estate-based returns, you’ll need to apply for an employer identification number (EIN) with the IRS. You can do this online, by fax or via mail.
Dying With a Will in Wisconsin
For a will to be valid in Wisconsin – which does not recognize hand-written wills – you must sign or acknowledge it in front of two witnesses, and those witnesses must sign your will within a reasonable time after you sign or acknowledge the will in front of them. Although you do not need a notary to make your will legal, a notary can allow you to make your will “self-proving.” A self-proving will speeds up the probate process because the court can accept the will without needing to contact the witnesses who signed the will. To make the will self-proving, you and your witnesses must each go to the notary and sign an affidavit proving who you are and that you know you were signing the will.
Once the will is determined to be valid, the next step is the probate process. Generally, probate proceedings are only necessary if the deceased person owned any assets in their name only. Other assets, also known as “non-probate” property, can usually be transferred to the other owner without probate. Wisconsin, which is not a Uniform Probate Code state, offers a simplified probate process for smaller estates, as well as an affidavit procedure that allows heirs to completely skip probate.
Estates qualify for Wisconsin’s affidavit procedure if the decedent’s solely owned property in Wisconsin is worth $50,000 or less. In order to use this process, all an heir has to do is prepare a short affidavit, signed under oath, that states that they are entitled to a certain asset. On the affidavit, the heir must describe the asset, list the asset’s value, and state whether or not the decedent or their spouse received medical services provided by the state. If the decedent received state-provided medical services, the heir must give notice of the intent to file the affidavit to the department of health services. The heir must attach a copy of this notice to the affidavit. When the person or institution holding the property receives the affidavit and a copy of the death certificate, they release the asset to the heir in question after 30 days. The heir takes the property subject to any creditor claims.
There is also a simplified probate procedure. However, there is no need to use the simplified probate procedure if you are already using the affidavit procedure. In order to qualify for the simplified small estate process in Wisconsin, the value of the estate must be worth $50,000 or less after mortgages and encumbrances are subtracted, and the decedent must be survived by a spouse or minor children. An estate can also qualify if the value of the estate, after mortgages and encumbrances are subtracted, does not exceed costs, expenses, allowances, and claims.
In order to use the simplified probate process, the heir files a written request with the local probate court asking to use it. The request must include a detailed statement of all property, including any liens, encumbrances, or other security interest, the names and mailing addresses of any inheritors, and a statement about whether or not the decedent or their spouse received medical services provided by the estate. The heir must give notice to the department of health services if the decedent or their spouse received medical services provided by the state. The court can allow the heir to distribute the assets without needing to go through ordinary probate. After 30 days from the notice, if required, the court will make an order directing the property to go to those individuals entitled to it, or to the spouse and children if applicable.
Dying Without a Will in Wisconsin
If you die without a valid will, you’ll lose control over what happens to your assets after your death. Wisconsin inheritance laws label these types of estates “intestate,” which means there is no will, or no valid will. The court will then follow intestate succession laws to determine who inherits your assets, and how much they get.
If there isn’t a will, the court will appoint someone, usually a relative, financial institution, or trust company to fill the role of executor or personal representative. The executor or personal representative takes care of wrapping up the decedent’s estate and distributing the inheritance.
Although there are usually extenuating factors when someone dies intestate, it’s best not to put your loved ones through that kind of stress. If you’re not sure what kind of estate plan you want to make, you can seek the help of a financial advisor specializing in legacy planning.
Spouses in Wisconsin Inheritance Law
It should be noted that in Wisconsin, which does not recognize common law marriages, rules that apply to married people also apply to registered domestic partners. If you die without a will and have a surviving spouse, your spouse’s inheritance depends partly on whether the property was owned as separate property or community property. In Wisconsin, community property is also known as marital property.
In general, community property is property acquired during the marriage, and separate property is acquired before marriage. There are a few exceptions. For example, gifts and inheritance given to one spouse only is separate property, even if it is acquired during the marriage. If you have a surviving spouse but no children, your spouse will inherit all of your community and separate property. If you have a surviving spouse and children who are also the spouse’s children, your spouse will still inherit all community and separate property.
If you have any descendants that are not also your surviving spouse’s, your spouse will not inherit your share of the community property. Instead, your descendants inherit your share of community property, and your spouse and descendants split your separate property equally. However, even in that situation, your spouse has the right to inherit a home from you, as long as your spouse already lives there for intends to live there. Your spouse may have to petition the court to claim this right and may be required to buy out any interest inherited by your descendants.
Children in Wisconsin Inheritance Law
If you have children but no spouse, your children will inherit everything.
|Intestate Succession: Spouses and Children|
|Inheritance Situation||Who Inherits Your Property|
|Children and no spouse||– Children inherit all property|
|Spouse and no children||– Spouse inherits all property|
|Spouse and children who are also the spouse’s children||– Spouse inherits all property|
|Spouse and one or more descendants from you and someone other than that spouse||– Spouse inherits half of your separate property |
– Children inherit your share of community property, as well as half your separate property
Under Wisconsin law, adopted children have just as much right to their share of intestate inheritance as biological children do. In addition, if the decedent placed their child up for adoption and that child was adopted by another family – other than your spouse – they are not legally eligible to receive intestate inheritance from the decedent. However, foster children and stepchildren who were never legally adopted by the decedent are not eligible to receive a share as the decedent’s child.
Children born outside of marriage still receive their share if you acknowledged your paternity in writing, you admitted in court that you are the father, or your paternity is otherwise established under Wisconsin law. Posthumous children, which are children conceived by you but born after your death, will receive a share as long as they survive at least 120 hours after being born. Grandchildren will receive a share only if their parent is not alive to inherit.
Unmarried Individuals Without Children in Wisconsin Inheritance Law
Intestate succession in Wisconsin if there is no surviving child or spouse is arranged as in the chart below:
|Intestate Succession: Extended Family|
|Inheritance Situation||Who Inherits Your Property|
|– If parents||Parents inherit everything|
|– If siblings, but no parents||Siblings inherit everything|
Although there is an intestate process designed to make sure your family inherits, it is generally best to write your own will. That way, you can ensure that all of your property ends up where you want it to after your death. If no eligible relatives can be found, your property will become the property of the state of Wisconsin.
Non-Probate Wisconsin Inheritances
The probate process can be costly and difficult. However, you have some options when trying to avoid probate in Wisconsin. These assets will also not be affected by intestate succession laws. Instead, they go directly to the named beneficiary upon your death. Listed below are some of the non-probate assets available in Wisconsin.
- Any property in a living trust
- Life insurance policies
- 401(k)s, IRAs, other retirement accounts
- Securities in transfer-on-death accounts
- Pay-on-death bank accounts
- Real property held by a transfer-on-death deed or beneficiary deed
- Joint tenancy real property
- Survivorship marital property
Other Situations in Wisconsin Inheritance Law
Wisconsin has a survivorship period. In order to inherit under Wisconsin’s intestate succession statutes, the heir in question must survive you by at least 120 hours. However, Wisconsin’s survivorship period doesn’t apply if the end result would be the state taking your property. In addition, relatives conceived before you die but born after you die, known as posthumous relatives, are eligible to inherit as if they had been born while you were alive, as long as they survive at least 120 hours after birth.
Immigration status is irrelevant when it comes to inheritance. If a relative of yours is entitled to a share of your assets, they can inherit no matter what their citizenship status is. Half-relatives inherit as much as “whole” relatives. For example, your half-sibling would get the same share as any other sibling.
There are some protections written into Wisconsin inheritance law. If you give an heir property during your lifetime, the value of that gift can be subtracted from your relative’s share, but only if it is in writing at the time the gift was made, or if the heir admits it in writing. In addition, if someone “unlawfully and intentionally” kills you, they will usually not receive a share of your property.
Resources for Estate Planning
- Managing your own estate, or handling the intricacies of inheriting money, can get complicated. That’s why many people choose to work with a professional. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- If you’d rather build your estate plan on your own, that’s definitely an option. However, there are a number of DIY estate planning mistakes you’ll want to avoid.
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