Estate Law Answers
I must have a will or my assets will pass to the state rather than my children.
If you do no estate planning, and you die owning assets in your individual name, a judge in probate court will apply the “State’s Will.” This is the state law, typically based on the Uniform Probate Code, which provides if an individual dies owning assets they will pass first to his/her spouse if living, then to children, grandchildren and so forth.
My spouse and I own everything jointly so we don’t need an “estate plan”.
While assets owned by spouses jointly will pass to the survivor without the need for court proceedings, a couple may want to determine whether the “State’s Will” will be acceptable to them at the death of the surviving spouse. ADDITIONALLY, there are some assets, which by nature, are not titled in the name of both spouses such as retirement accounts or life insurance. If the owning spouse of the retirement accounts or life insurance became incapacitated, the other spouse would have no authority over those accounts and could not access them without court approval for the needs of the couple.
I do not need a financial power of attorney because my spouse and I own everything jointly.
While joint owners on accounts have equal access to those accounts, married couples often have one key asset which is owned by each individually, their retirement accounts. In the event of any incapacity of one spouse, the other would have no rights to that account, even if the spouse is the beneficiary. The beneficiary designation does not allow access until after the death of the owning spouse. Further, in order to sell real estate, all owners must execute a deed. In the event of an incapacity without a durable financial power of attorney, a guardianship will need to be sought through the Court system to access the accounts of the incapacitated individual.
My doctor will let my spouse or my children make health care decisions for me.
While you may occasionally find a doctor willing to allow this to happen, the law directs physicians to only allow an individual to make healthcare decisions for himself or to allow an agent designated under a valid Health Care Power of Attorney form to make that decision. In today’s society of increased malpractice claims, most doctors are unwilling to accept the next of kin’s decisions without some type of legal authority. If you do not have a Health Care Power of Attorney and you cannot communicate your health care wishes, then a guardian must be appointed by a court to act on your behalf. Further, a Living Will or “Declaration to Physicians” is merely a directive by an individual to his physician to terminate life sustaining measures in the event of a terminal illness or persistent vegetative state.
Checking “yes” to admission to a nursing home on my health care power of attorney directs my agent to place me in a nursing home despite my wish to remain at my home as long as possible.
Wisconsin Law provides that there are certain decisions that so severely affect an individual’s basic rights that they must be specifically transferred in a health care power of attorney. Therefore, decision-making authority regarding placement in a nursing home/community-based residential facility, withholding/withdrawing a feeding tube, or making decisions for a woman while pregnant cannot be transferred to a health care agent unless the individual specifically gives them those rights by checking “Yes”. If the boxes are not checked “Yes” and on the off-chance that you will be required to enter a nursing home as a last resort, your family will have to seek permission from the Court prior to placing you there.
I want to avoid probate so I will put my children’s names on all my accounts.
While this will allow you to be successful in avoiding probate, putting your children’s names on your accounts is dangerous because it now subjects those accounts to claims of their creditors.
I live in Wisconsin and because of marital property all my assets will automatically go to my spouse when I die.
Not necessarily true.
If assets are titled only in husband’s name (for example), wife will automatically be entitled to one-half of those assets, 100% of which must be probated in order to complete their transfer. Husband, however, may alter the “State’s Will” (which provides his undivided ½ interest goes to spouse) by drafting his own Will with alternate provisions. The ownership title on each of those assets will dictate whether they will pass through probate, even if you are married.
My children are so responsible so they would never have issues with a creditor so I don't have to consider their potential creditor issues in my planning.
Not necessarily true.
Creditors are not only individuals who your children owe debt obligations, but could include spouses in a divorce situation, medical bills occurred in an accident in which your child was not at fault, failure of a business due to a partner’s decision or judgements against your child resulting from an accident with unintentional consequences.