Chapter 854

854.09 854.09 Advancement; satisfaction.

854.09(1) (1) A gift that the decedent made during his or her lifetime, including an incomplete gift that became complete on the decedent’s death, is treated as a full or partial satisfaction of a transfer at death to an heir under s. 852.01 (1) or a transferee under a governing instrument executed by the decedent only if at least one of the following applies:

854.09(1)(a) (a) The governing instrument, if any, either expressly or as construed from extrinsic evidence, provides that the gift be taken into account.

854.09(1)(b) (b) The decedent declared in a document, either expressly or as construed from extrinsic evidence, that the gift is in satisfaction of, or an advance against, what the transferee would receive at the decedent’s death, whether or not the document was contemporaneous with the gift.

854.09(1)(c) (c) The transferee acknowledged in writing before or after the decedent’s death, either expressly or as construed from extrinsic evidence, that the gift is in satisfaction of, or an advance against, what the transferee would receive at the decedent’s death.

854.09(2) (2) For partial satisfaction, property given during life is valued as of the time that the transferee came into possession or enjoyment of the property or at the death of the person who executed the governing instrument, whichever occurs first.

854.09(3) (3) If the transferee fails to survive the person who executed the governing instrument and his or her issue take a substitute transfer under intestacy or under a governing instrument, the issue receive the same transfer that the named transferee would have received had the transferee survived, unless the transferor declared otherwise in a document, either expressly or as construed from extrinsic evidence.

854.09 History History: 1997 a. 188; 2005 a. 216.

854.10 854.10 Choice of law. The meaning and legal effect of a governing instrument are determined by the local law of the state selected by the transferor in the governing instrument, unless the application of that law is contrary to s. 861.02 or 861.31 or any other public policy of this state otherwise applicable to the disposition.

854.10 History History: 1997 a. 188.

854.11 854.11 Gift of securities.

854.11(1) (1) Definition. In this section, “securities” includes all of the following:

854.11(1)(a) (a) Any note, stock, treasury stock, bond, debenture, evidence of indebtedness, collateral trust certificate, transferable share or voting trust certificate.

854.11(1)(b) (b) Any certificate of interest or participation in an oil, gas or mining title or lease or in payments out of production under such a title or lease.

854.11(1)(c) (c) Any interest or instrument commonly known as a security.

854.11(1)(d) (d) Any certificate of interest or participation in, any temporary or interim certificate, receipt or certificate of deposit for, or any warrant or right to subscribe to or purchase, any of the instruments or interests specified in pars. (a) to (c).

854.11(2) (2) Increase in securities; accessions. Except as provided in sub. (4), if a person executes a governing instrument that transfers securities and at the time of the execution or immediately after execution the described securities are in fact governed by the instrument, the transfer includes additional securities that are governed by the instrument at the person’s death if all of the following apply:

854.11(2)(a) (a) The additional securities were acquired after the governing instrument was executed.

854.11(2)(b) (b) The additional securities were acquired as a result of ownership of the described securities.

854.11(2)(c) (c) The additional securities are any of the following types:

854.11(2)(c)1. 1. Securities of the same organization acquired as a result of a plan of reinvestment.

854.11(2)(c)2. 2. Securities of the same organization acquired by action initiated by the organization or any successor, related or acquiring organization, excluding any acquired by exercise of purchase options.

854.11(2)(c)3. 3. Securities of another organization acquired as a result of a merger, consolidation, reorganization or other distribution by the organization or any successor, related or acquiring organization.

854.11(3) (3) Gift of securities construed as specific. Except as provided in sub. (4), a transfer of a stated number of shares or amount of securities is construed to be a specific gift if the same or a greater number of shares or amount of the securities was governed by the instrument at the time of, or immediately after, execution of the instrument, even if the instrument does not describe the securities more specifically or qualify the description by a possessive pronoun such as “my”.

854.11(4) (4) Contrary intent. If the person who executed the governing instrument had an intent contrary to any provision in this section, then that provision is inapplicable to the transfer. Extrinsic evidence may be used to construe the intent.

854.11 History History: 1997 a. 188; 2005 a. 216.

854.12 854.12 Debt to transferor.

854.12(1) (1) Heir under intestacy.

854.12(1)(a) (a) If an heir owes a debt to the decedent, the amount of the indebtedness shall be offset against the intestate share of the debtor heir.

854.12(1)(b) (b) In contesting an offset under par. (a), the debtor heir shall have the benefit of any defense that would be available to the debtor heir in a direct proceeding by the personal representative for the recovery of the debt, except that the debtor heir may not defend on the basis that the debt was discharged in bankruptcy or on the basis that the relevant statute of limitations has expired. If the debtor fails to survive the decedent, the court may not include the debt in computing any intestate shares of the debtor’s issue.

854.12(2) (2) Transferee under revocable governing instrument.

854.12(2)(a) (a) Subject to par. (c), if a transferee under a revocable governing instrument survives the transferor and is indebted to the transferor, the amount of the indebtedness shall be treated as an offset against the property to which the debtor transferee is entitled. If multiple revocable governing instruments transfer property to the debtor, the debt shall be equitably allocated against the various instruments.

854.12(2)(b) (b) Subject to par. (c), in contesting an offset under par. (a), the debtor shall have the benefit of any defense that would be available to the transferee in a direct proceeding for the recovery of the debt, except that the transferee may not defend on the basis that the debt was discharged in bankruptcy, unless that discharge occurred before the execution of the governing instrument, or on the basis that the relevant statute of limitations has expired. If the transferee fails to survive the decedent, the debt may not be included in computing the entitlement of alternate beneficiaries.

854.12(2)(c) (c) If the person who executed the governing instrument had an intent contrary to any provision in this subsection, then that provision is not applicable to the transfer. Extrinsic evidence may be used to construe the intent.

854.12(3) (3) Property not distributed because of offset. The property not distributed to the debtor becomes part of the residue of the entity that holds the debt. If the debt is not held by an entity, then the property not distributed to the debtor becomes part of the residue of the decedent’s probate estate.

854.12 History History: 2005 a. 216.

854.13 854.13 Disclaimer of transfers at death.

854.13(1) (1) Definitions. In this section:

854.13(1)(a) (a) “Beneficiary under a governing instrument” includes any person who receives or might receive property under the terms or legal effect of a governing instrument.

854.13(1)(c) (c) “Power of appointment” has the meaning given in s. 702.102 (15).

854.13(2) (2) Right to disclaim.

854.13(2)(a) (a) In general.

854.13(2)(a)1. 1. In this paragraph, “person” includes a person who is unborn or whose identity is unascertained.

854.13(2)(a)2. 2. A person who is an heir, recipient of property, or beneficiary under a governing instrument, donee of a power of appointment created by a governing instrument, appointee under a power of appointment exercised by a governing instrument, taker in default under a power of appointment created by a governing instrument, or person succeeding to disclaimed property may disclaim any property, including contingent or future interests or the right to receive discretionary distributions, by delivering a written instrument of disclaimer under this section.

854.13(2)(b) (b) Joint tenants. Upon the death of a joint tenant, a surviving joint tenant may disclaim any property that would otherwise accrue to him or her by right of survivorship and that is the subject of the joint tenancy by delivering a written instrument of disclaimer under this section.

854.13(2)(c) (c) Survivorship marital property. Upon the death of a spouse, the surviving spouse may disclaim the decedent spouse’s interest in survivorship marital property.

854.13(2)(d) (d) Partial disclaimer. Property may be disclaimed in whole or in part, except that a partial disclaimer of property passing by a governing instrument or by the exercise of a power of appointment may not be made if partial disclaimer is expressly prohibited by the governing instrument or by the instrument exercising the power of appointment.

854.13(2)(e) (e) Spendthrift provision. The right to disclaim exists notwithstanding any limitation on the interest of the disclaimant in the nature of a spendthrift provision or similar restriction.

854.13(2)(f) (f) Disclaimer by guardian or conservator. A guardian of the estate or a conservator appointed under ch. 54 or ch. 880, 2003 stats., may disclaim on behalf of his or her ward, with court approval, if the ward is entitled to disclaim under this section.

854.13(2)(g) (g) Disclaimer by agent under power of attorney. An agent under a power of attorney may disclaim on behalf of the person who granted the power of attorney if all of the following apply:

854.13(2)(g)1. 1. The person who granted the power of attorney is entitled to disclaim under this section.

854.13(2)(g)2. 2. The power of attorney specifically grants the power to disclaim.

854.13(2)(gm) (gm) Disclaimer by trustee. The trustee of a trust named as a recipient of property under a governing instrument may disclaim that property on behalf of the trust if the trust authorizes disclaimer by the trustee. If the trust does not authorize disclaimer by the trustee, the trustee’s power to disclaim is subject to the approval of the court.

854.13(2)(h) (h) After death. A person’s right to disclaim survives the person’s death and may be exercised by the person’s personal representative or special administrator upon receiving approval from the court having jurisdiction of the person’s estate after hearing upon notice to all persons interested in the disclaimed property, if the personal representative or special administrator has not taken any action that would bar the right to disclaim under sub. (11g).

854.13(2)(i) (i) Disclaimer of inter vivos transfers. A person who is a recipient of property under an inter vivos governing instrument, as defined in s. 700.27 (1) (c), may disclaim the property as provided in s. 700.27.

854.13(3) (3) Instrument of disclaimer. The instrument of disclaimer shall do all of the following:

854.13(3)(a) (a) Describe the property disclaimed.

854.13(3)(b) (b) Declare the disclaimer and the extent of the disclaimer.

854.13(3)(c) (c) Be signed by the disclaimant.

854.13(3)(d) (d) Be delivered within the time and in the manner provided under subs. (4) and (5).

854.13(4) (4) Time for effective disclaimer.

854.13(4)(a) (a) Present interest. An instrument disclaiming a present interest shall be executed and delivered not later than 9 months after the effective date of the transfer under the governing instrument. For cause shown, the period may be extended by a court of competent jurisdiction, either within or after the 9-month period, for such additional time as the court considers just.

854.13(4)(b) (b) Future interest. An instrument disclaiming a future interest shall be executed and delivered not later than 9 months after the event that determines that the taker of the property is finally ascertained and his or her interest indefeasibly fixed. For cause shown, the period may be extended by a court of competent jurisdiction, either within or after the 9-month period, for such additional time as the court considers just.

854.13(4)(c) (c) Future right to income or principal. Notwithstanding pars. (a) and (b), an instrument disclaiming the future right to receive discretionary or mandatory distributions of income or principal from any source may be executed and delivered at any time.

854.13(4)(d) (d) Persons under 21. Notwithstanding pars. (a) and (b), a person under 21 years of age may disclaim at any time not later than 9 months after the date on which the person attains 21 years of age.

854.13(4)(e) (e) Interests arising by disclaimer. Notwithstanding pars. (a) and (b), a person whose interest in property arises by disclaimer or by default of exercise of a power of appointment created by a governing instrument may disclaim at any time not later than 9 months after the day on which the prior instrument of disclaimer is delivered, or the date of death of the donee of the power of appointment.

854.13(5) (5) Delivery and filing of disclaimer.

854.13(5)(a) (a) Delivery. In addition to any requirements imposed by the governing instrument, the instrument of disclaimer is effective only if, within the time specified under sub. (4), it is delivered to and received by any of the following:

854.13(5)(a)1. 1. The transferor of the property disclaimed, if living.

854.13(5)(a)2. 2. The personal representative or special administrator of the deceased transferor of the property.

854.13(5)(a)3. 3. The holder of legal title to the property.

854.13(5)(b) (b) Delivery to trustee. If the trustee of any trust to which the interest or power of appointment relates does not receive the instrument of disclaimer under par. (a), a copy shall also be delivered to the trustee.

854.13(5)(c) (c) Filing. When delivery is made to the personal representative or special administrator of a deceased transferor, a copy of the instrument of disclaimer shall be filed in the probate court having jurisdiction.

854.13(5)(d) (d) Failure to deliver or file. Failure to deliver a copy of the instrument of disclaimer to the trustee under par. (b) or to file a copy in the probate court under par. (c), within the time specified under sub. (4), does not affect the validity of any disclaimer.

854.13(5)(e) (e) Recording. If real property or an interest in real property is disclaimed, a copy of the instrument of disclaimer may be recorded in the office of the register of deeds of the county in which the real estate is situated.

854.13(6) (6) Property not vested. The property disclaimed under this section shall be considered not to have been vested in, created in or transferred to the disclaimant.

854.13(7) (7) Devolution.

854.13(7)(a) (a) In general. Subject to pars. (bm) and (c) and subs. (8), (9), and (10), unless the governing instrument provides otherwise, either expressly or as construed from extrinsic evidence, the disclaimed property devolves as if the disclaimant had died before the decedent. If the disclaimed interest is a remainder contingent on surviving to the time of distribution, the disclaimed interest passes as if the disclaimant had died immediately before the time for distribution. If the disclaimant is an appointee under a power of appointment exercised by a governing instrument, the disclaimed property devolves as if the disclaimant had died before the effective date of the exercise of the power of appointment. If the disclaimant is a taker in default under a power of appointment created by a governing instrument, the disclaimed property devolves as if the disclaimant had predeceased the donee of the power of appointment.

854.13(7)(bm) (bm) Devolution to issue of the disclaimants. Unless the governing instrument provides otherwise, either expressly or as construed from extrinsic evidence, if, by law or under the governing instrument, the issue of the disclaimant would share in the disclaimed interest by any method of representation had the disclaimant died before the time the disclaimed interest would have taken effect in possession or enjoyment, the disclaimed interest passes only to the issue of the disclaimant who survive when the disclaimed interest takes effect in possession or enjoyment.

854.13(7)(c) (c) Disclaimer of a devisable future interest.

854.13(7)(c)1. 1. In this paragraph, “devisable future interest” is a future interest that can be passed under the will of the person who holds the future interest.

854.13(7)(c)2. 2. If the disclaimed interest is a devisable future interest under the law governing the transfer, then the disclaimed interest devolves as if it were a nondevisable future interest.

854.13(8) (8) Devolution of disclaimed interest in joint tenancy. Unless the decedent provided otherwise in a governing instrument, either expressly or as construed from extrinsic evidence, a disclaimed interest in a joint tenancy passes to the decedent’s probate estate.

854.13(9) (9) Devolution of disclaimed interest in survivorship marital property. Unless the decedent provided otherwise in a governing instrument, either expressly or as construed from extrinsic evidence, a disclaimed interest in survivorship marital property passes to the decedent’s probate estate.

854.13(10) (10) Acceleration of subsequent interests when preceding interest is disclaimed.

854.13(10)(a) (a) Subsequent interest not held by disclaimant. Unless the governing instrument provides otherwise, either expressly or as construed from extrinsic evidence, upon the disclaimer of a preceding interest, a subsequent interest not held by the disclaimant and limited to take effect in possession or enjoyment after the termination of the interest that is disclaimed accelerates to take effect as if the disclaimant had died immediately before the time when the disclaimed interest would have taken effect in possession or enjoyment or, if the disclaimant is an appointee under a power of appointment and that power of appointment has been exercised, as if the disclaimant had died before the effective date of the exercise of the power of appointment.

854.13(10)(b) (b) Subsequent interest held by the disclaimant. Unless the governing instrument provides otherwise, either expressly or as construed from extrinsic evidence, upon the disclaimer of a preceding interest, a subsequent interest held by the disclaimant does not accelerate.

854.13(11g) (11g) Bar. Bars to a person’s right to disclaim property include, but are not limited to, any of the following:

854.13(11g)(a) (a) The person’s assignment, conveyance, encumbrance, pledge, or transfer of the property or a contract for the assignment, conveyance, encumbrance, pledge, or transfer of the property.