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)(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(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 created by a governing instrument, appointee under a power exercised by a governing instrument, taker in default under a power 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 may not be made if partial disclaimer is expressly prohibited by the governing instrument or by the instrument exercising the power.
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)(b)
(b) Declare the disclaimer and the extent of the disclaimer.
854.13(3)(d)
(d) Be delivered within the time and in the manner provided under
subs. (4) and
(5).
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 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.
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)(b)
(b)
Delivery to trustee. If the trustee of any trust to which the interest or power 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)(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 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. If the disclaimant is a taker in default under a power created by a governing instrument, the disclaimed property devolves as if the disclaimant had predeceased the donee of the power.
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)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 exercised by a power of appointment, as if the disclaimant had died before the effective date of the exercise of the power.
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.
854.13(11g)(b)
(b) The person's written waiver of the right to disclaim.
854.13(11g)(c)
(c) The person's acceptance of the property or benefit of the property.
854.13(11p)
(11p) Effect of disclaimer or waiver. The disclaimer or the written waiver of the right to disclaim is binding upon the disclaimant or person waiving and all persons claiming through or under him or her.
854.13(12)(a)(a) This section does not affect the right of a person to waive, release, disclaim or renounce property under any other statute, the common law, or as provided in the creating instrument.
854.13(12)(b)
(b) Any disclaimer that meets the requirements of section
2518 of the Internal Revenue Code, or the requirements of any other federal law relating to disclaimers, constitutes an effective disclaimer under this section or
s. 700.27.
854.13(13)
(13) Construction of effective date. In this section, the effective date of a transfer under a revocable governing instrument is the date on which the person with the power to revoke the transfer no longer has that power or the power to transfer the legal or equitable ownership of the property that is the subject of the transfer.
854.13 Note
NOTE: 1991 Wis. Act 301, which affected this section, contains extensive legislative council notes.
854.13 Annotation
Unless barred by statute, a debtor can disclaim a bequest, thus defeating a creditor's action under s. 813.026. Estate of Goldhammer v. Goldhammer,
138 Wis. 2d 77,
405 N.W.2d 693 (Ct. App. 1987).
854.13 Annotation
Except for a tax-related "qualified disclaimer," the 9-month time limit for the disclaimer of a future interest commences on the death of the life tenant. Estate of Balson,
183 Wis. 2d 31,
515 N.W.2d 474 (Ct. App. 1994).
854.13 Annotation
A surviving spouse cannot disclaim a wrongful death claim under s. 854.13 so as to pass ownership of that claim to the deceased's lineal heirs. Bowen v. American Family Insurance Company,
2012 WI App 29,
340 Wis. 2d 232,
811 N.W.2d 887,
11-0185.
854.13 Note
NOTE: The preceding cases were decided prior to the adoption of
1997 Wis. Act 188, which made extensive revisions to s. 853.40 and resulted in the creation of s. 854.06.
854.14
854.14
Beneficiary who kills decedent. 854.14(2)
(2)
Revocation of benefits. Except as provided in
sub. (6), the unlawful and intentional killing of the decedent does all of the following:
854.14(2)(a)
(a) Revokes a provision in a governing instrument that, by reason of the decedent's death, does any of the following:
854.14(2)(a)3.
3. Nominates or appoints the killer to serve in any fiduciary or representative capacity, including personal representative, trustee, or agent.
854.14(2)(b)
(b) Severs the interests of the decedent and killer in property held by them as joint tenants with the right of survivorship or as survivorship marital property and transforms the interests of the decedent and the killer into tenancies in common or marital property, whichever is appropriate.
854.14(2)(c)
(c) Revokes every statutory right or benefit to which the killer may have been entitled by reason of the decedent's death.
854.14(3)
(3) Effect of revocation. Except as provided in
sub. (6), provisions of a governing instrument that are revoked by this section are given effect as if the killer disclaimed all revoked provisions or, in the case of a revoked nomination in a fiduciary or representative capacity, as if the killer predeceased the decedent. Except as provided in
sub. (6), the killer's share of the decedent's intestate estate, if any, passes as if the killer had disclaimed his or her intestate share under
s. 854.13.
854.14(3m)
(3m) Additional effects if death caused by spouse. 854.14(3m)(a)1.
1. "Owner" means a person appearing on the records of the policy issuer as the person having the ownership interest, or means the insured if no person other than the insured appears on those records as a person having that interest. In the case of group insurance, the "owner" means the holder of each individual certificate of coverage under the group plan and does not include the person who contracted with the policy issuer on behalf of the group, regardless of whether that person is listed as the owner on the contract.
854.14(3m)(a)2.
2. "Ownership interest" means the rights of an owner under a policy.
854.14(3m)(a)3.
3. "Policy" means an insurance policy insuring the life of a spouse and providing for payment of death benefits at the spouse's death.
854.14(3m)(a)4.
4. "Proceeds" means the death benefit from a policy and all other economic benefits from it, whether they accrue or become payable as a result of the death of an insured person or upon the occurrence or nonoccurrence of another event.
854.14(3m)(b)1.1. Except as provided in
sub. (6), if a noninsured spouse unlawfully and intentionally kills an insured spouse, the surviving spouse's ownership interest in a policy that designates the decedent spouse as the owner and insured, or in the proceeds of such a policy, is limited to a dollar amount equal to one-half of the marital property interest in the interpolated terminal reserve and in the unused portion of the term premium of the policy on the date of death of the decedent spouse. All other rights of the surviving spouse in the ownership interest or proceeds of the policy, other than the marital property interest described in this subsection, terminate at the decedent spouse's death.
854.14(3m)(b)2.
2. Notwithstanding
s. 766.61 (7) and except as provided in
sub. (6), if an insured spouse unlawfully and intentionally kills a noninsured spouse, the ownership interest at death of the decedent spouse in any policy with a marital property component that designates the surviving spouse as the owner and insured is a fractional interest equal to one-half of the portion of the policy that was marital property immediately before the death of the decedent spouse.
