If a family member passes away with a relatively small estate, it is often not necessary to open an Informal or Formal Probate action in Probate Court. Rather, you may be able to simply use a Transfer by Affidavit.
A Transfer by Affidavit can generally be used when the person who passed away left behind less than $50,000 in probate assets, whether or not they had a Will. Probate assets do not include assets such as joint bank accounts, jointly held real estate, retirement accounts with beneficiary designations, life insurance policies with named beneficiaries, or Payable on Death bank accounts.
Transfers by Affidavit may only be used by an heir or a former guardian of the deceased person. An heir is the person who stands to inherit if the decedent did not have a will. For instance, the surviving spouse would be an heir, as would all children of the decedent if they were not survived by a spouse.
The State of Wisconsin has a standard Transfer by Affidavit form, which can be downloaded from this site.
If there are multiple heirs, such as several surviving children of a single decedent, only one of the heirs needs to complete the Affidavit.
Section 1 of the form asks for basic demographic information such as the date of birth and date of death.
Section 2 asks for the person’s relationship to the decedent; most often you will be checking the box for “heir” and then describing your relationship.
Section 3 asks for the total gross value of the estate – this is the value of all probate assets before any liens or debts are subtracted. This number must be $50,000 or less in order to use this form.
Section 4 seeks information as to whether the decedent received certain state benefits during their lifetime, such as Medicaid or Family Care.
Section 5 asks for information on any spouses of the decedent, whether or not they were alive and/or married at the time of death, and also asks whether that spouse also received certain state benefits.
Section 6 then requires the listing of all assets to be transferred using the Affidavit. For real estate, you must provide the formal legal description of the property.
If either the deceased person or their spouse received any of the specified state benefits, or if you are unsure whether they have, you are required to mail a copy of the Transfer by Affidavit to the State of Wisconsin Estate Recovery Program. Under this program, the State has the ability to seek reimbursement out of a person’s estate for payments it made during the person’s lifetime for certain state benefits, particularly Medicaid.
You must send a copy of the Transfer by Affidavit, by certified mail, return receipt requested, to the following address:
Department of Health and Family Services
Estate Recovery Program
P.O. Box 309
Madison, WI 53701-0308
You also need to provide the decedent’s Social Security Number on a separate piece of paper along with the Affidavit.
If there is real estate at issue, you must then wait ten days after receiving the certified receipt back in the mail before recording the Affidavit with the Register of Deeds.
You must then wait to see whether you are contacted by the Estate Recovery Department regarding a lien. If so, you will need to follow the instructions in their correspondence to determine what, if any, sum of money needs to be sent to the state. Unfortunately, Estate Recovery is not bound by any deadlines to submit their lien to you. It may take several months before you receive a response.
Assuming there is no lien received from the state, if the Transfer by Affidavit includes assets such as a bank account or investment account, you can take the completed Affidavit, along with a Death Certificate, to the financial institution to receive the funds. If the Transfer by Affidavit involves real estate, then you should record a duplicate original of the Affidavit with the Register of Deeds in the county where the property is located. The recording of the Transfer by Affidavit serves as documentation of the transfer from the decedent to the heir. Keep in mind that although you will not have to pay a Real Estate Transfer Tax for this type of transfer, it is still necessary for you to go the Department of Revenue website and complete an online Transfer Return.
For questions on how to complete a Transfer by Affidavit, feel free to contact Lippow Law Offices at 414-312-4928.