Today, a client told me that he was honored that his parents selected him out of the four children to act as the Personal Representative of their estates, but now after acting as such for the past couple of months he wasn’t so sure it was an honor.  It has been a daunting task for him.  This isn’t the first time I have heard this complaint from a client and I am sure it won’t be the last. 

But let me digress a moment and define what I am referring to before I explain further.  The term personal representative is another word for an executor (male) or executrix (female).  Back when I was in law school the title was changed to ‘personal representative’ to make the language gender neutral. 

Now the job of the personal representative in an estate varies depending on the situation.  But in general he or she is responsible for marshaling all of the assets, paying the bills, providing an accounting of such, selling such assets (if they need to be converted to cash), cancelling all the household and personal accounts and then distributing everything according to the Will. 

Cancelling household and personal accounts can be time consuming.  Just think about the last time you had to call the cable company to cancel or modify your subscription. You might have been in voice mail hell for hours.   Marshaling all the assets may take time and detective work if records are not kept current or are disorganized.  Besides that issue, each stock transfer company or brokerage house has their own rules and requirements for liquidation and of course a ton of paper work.  Before selling a house owned in an estate the house may have to have repairs made and thus, there is the calling and arranging for contractors and workers.  The personal representative may also need to be on site to see that the job is done according to plan. There are also certificates of compliance to obtain and the scheduling of inspections from the village/town/city where the house is located.  

Consequently, in selecting a personal representative, you want someone who is organized, patient and has the time available.  Knowledge of financial matters and the basic ability to keep records and balance check books would help too. 

So who do you select?  Generally one of the kids who is in town.  But maybe that is not always best.  Are there alternatives? Your attorney can act as the personal representative.  Do I act as such? Yes, on occasion.  I really do decline most requests unless it is a situation where there really is no one else.  Ethically we are not to place ourselves in the position so that a client feels we are the client’s only choice.  However, I am thinking more and more, that since I do have the skill set necessary, perhaps I should be more open to acting as such when clients do ask me.  Obviously the choice is ultimately yours, but if nothing else in the planning stage I would encourage discussing the future responsibilities with your intended selection before just naming them as such in your document. 

Note: In Wisconsin the personal representative is entitled to compensation for acting as such.  As a general rule they are entitled to 2% of the estate.  If your attorney is acting as the personal representative they may receive the percentage or they may bill based on their customary hourly basis, but not both. 

I hope that this is of help to you and again feel free to comment or ask questions.

My mother sends me emails everyday sent to her by others.  Some are funny, some are charming and others are just plain wrong.  Today's email was about the current tax rates and how someone can send out such erroneous information is beyond me.  So if there is any misconception out there about the current (2014) tax rates let me clarify.

The Federal estate tax rate maximum is 40%.  That is the rate applied to estates or to gifts in excess of $5,350,000 and only to transfers to someone other than a spouse. The amount of $5,350,000 is adjusted each year in accordance with inflation.  Transfers to a spouse have no transfer tax applied to such a transfer.  The top Federal capital gains rate is 20%, however an additional tax maybe applied to high income earners of an additional 3.8% for a total tax rate of 23.8%.  Collectibles are taxed at 28%.  The top Federal income tax rate is 39.6% and also may have the additional 3.8% tax applied for high income earners.  Social security tax on wages is an additional 15.3% - one half is paid by the employer and one half is paid by the employee.   Social security tax is a combination of social security and medicare tax. 

Knowing the tax rates is just as important as paying attention to your investments.  So work with your accountant or your tax advisor to understand your particular tax situation. 

I know you are all wondering what in the world is a gamete.  Well that is your reproductive material - either sperm or ova.  Why the heck would I, an estate planning attorney, be writing about that.  Well I will tell you.  In this wonderful world of modern medicine, reproductive technology has a tremendous impact on estate planning. The freezing of ova and sperm for later usage is no longer the story line from a science fiction book or movie, it is now almost a common place practice and rapidly expanding. Today - in the U.S. alone there are over 6 million children conceived using some type of reproductive technology. Sometimes these children are born long after a parent/grandparent's death.  These posthumously conceived children are real possibilities and planning for such a possible eventuality - whether it is for your children or grandchildren - is an important component of an estate plan.  So in the interest of being thorough I am going to ask you about your feelings and thoughts with regards whether you would like such children to inherit or not when discussing your estate plan.   It is also important to plan for the eventual disposition of remaining gametes in an estate plan. Thus, I am going to be a bit nosy, and ask you if you are storing genetic material, or if your children are.  I prefer to be proactive and not leave such an important consideration to chance, particularly when there is so little judicial precedent.  I am going to guess that you have some definite opinions as well and would like to see your desires with regards to inheritances for these children set forth in writing.  Of course having an estate plan is even more important for you to create if you are using medical reproductive technologies as there may not be a right under Wisconsin law for posthumously conceived children to inherit if there is no Will.  Thus, if you want to provide for such children you must have a testamentary document in place.