Jun 27, 2024

To understand a pour-over will, it is important to have a basic understanding of a revocable trust. A revocable trust allows you to place your assets into the trust and continue to control and use them during your lifetime. You no longer own your assets, your trust does. Once you pass away, assets held in the revocable trust can avoid the probate process and be handled according to the terms of the trust. However, a trust only has authority over the assets in it. This is where a pour-over will comes into play. Let’s discuss what a pour-over will is, how it works, and why it is important.

What Is a Pour-Over Will?

A pour-over will is created along with your revocable trust. It is a type of will that directs any assets you own personally at the time of your death to be given to your trust. Ideally, all the assets you own, and any assets acquired after the creation of your trust, will already be in the name of your trust or have a beneficiary listed. However, life and death, don’t always go as planned.

How It Works?

A pour-over will acts as a safety net. It captures assets you didn’t put into your trust during your lifetime and directs them to be transferred into your trust after your death. However, this transfer does not happen automatically. In Wisconsin, assets of $50,000 or more must go through the probate process, which can be expensive and time-consuming. If the forgotten assets are under $50,000, they can avoid probate. The assets can be transferred to your revocable trust using a transfer by affidavit. Using a transfer by affidavit is a much faster and simpler process. Once all your assets are in the trust, they can be managed through the trust administration process.

Why Is It Important?

One of the major benefits of creating a revocable trust is to avoid probate, which is why a pour-over will should only be used as a backup plan. Having a pour-over will ensures that all your assets will be handled and distributed according to the terms of your trust. Without a pour-over will, assets not included in your trust will be distributed as if you died without a will. Consequently, those assets will be divided according to Wisconsin’s intestate succession laws, which may not align with your wishes.

A pour-over will is also a very important part of your estate plan if you have minor children. Your trust controls your assets and how they are utilized for your minor children and eventually distributed to them. Appointing a guardian for your minor children can only be done through a will, not through your trust. This allows you to choose the person who will take care of your children, not the court.

FREE CONSULTATIONS

Including a pour-over will in your estate plan can provide reassurance that your assets will be managed according to your wishes outlined in your revocable trust. However, estate planning does not have a one-size-fits-all solution. An experienced estate planning attorney can help determine and explain the best structure for your unique situation. At Pedersen Law Office, LLC we offer free consultations in estate planning. We meet with you personally to understand your specific circumstances, needs and goals to create an estate plan right for you and your family. Our law office serves the communities of Appleton, Menasha, Neenah, Oshkosh, Green Bay and their surrounding areas.