861.03 Augmented deferred marital property estate: decedent's probate property and nonprobate or other property transfers. Subject to s. 861.05, the augmented deferred marital property estate includes all of the following:
(1) Deferred marital property in decedent's probate estate. The value of deferred marital property in the decedent's probate estate.
(2) Deferred marital property passing nonprobate at decedent's death. The value of deferred marital property owned or owned in substance by the decedent immediately before death that passed outside probate at the decedent's death, including the following:
(a) The decedent's fractional interest in deferred marital property that was held by the decedent with the right of survivorship.
(b) The decedent's ownership interest in deferred marital property that was held by the decedent in a form payable or transferable on death, including deferred employment benefit plans, individual retirement accounts, annuities and transfers under s. 766.58 (3) (f), or in co-ownership with the right of survivorship.
(c) Deferred marital property in the form of proceeds of insurance on the life of the decedent, including accidental death benefits, that were payable at the decedent's death, if the decedent owned the insurance policy immediately before death or if the decedent alone and immediately before death held a presently exercisable general power of appointment over the policy or its proceeds.
(d) Deferred marital property over which the decedent alone, immediately before death, held a presently exercisable general power of appointment, to the extent that the property passed at the decedent's death by exercise, release, lapse, default or otherwise.
(3) Deferred marital property transferred with retained rights or benefits.
(a) The augmented deferred marital property estate includes the value of any deferred marital property transferred by the decedent in which the decedent retained rights or benefits, including but not limited to the following:
1. Deferred marital property in which the decedent retained the right to possession, use, enjoyment or income and that was irrevocably transferred, to the extent that the decedent's right terminated at or continued beyond the decedent's death.
2. Deferred marital property in which the decedent retained the right, either alone or in conjunction with any person, to designate the persons who shall possess or enjoy the property or the income therefrom, to control the time at which designated persons shall possess or enjoy the property or income therefrom, or to alter or amend the terms of the transfer of the property, to the extent that the decedent's right terminated at or continued beyond the decedent's death.
3. Any transfer of deferred marital property, including transfer of an income interest, in which the decedent created a power of appointment, including the power to revoke or terminate the transfer or to consume, invade or dispose of the principal or income, if the power was exercisable by the decedent alone, by the decedent in conjunction with another person or by a nonadverse party, and if the power is for the benefit of the decedent, creditors of the decedent, the decedent's estate or creditors of the decedent's estate.
(b) The amount included under par. (a) 3. is the value of the property subject to the power of appointment if the power of appointment is over property, the value of the property that produces or produced the income if the power of appointment is over income or the power valued at the higher amount if the power of appointment is over both income and property. The value is limited by the extent to which the power of appointment was exercisable at the decedent's death or the property passed at the decedent's death by exercise, release, lapse, default or otherwise.
(4) Deferred marital property transferred within 2 years prior to death.
(a) In this subsection, termination occurs:
1. With respect to a right or interest in property, when the right or interest terminates by the terms of the governing instrument or when the decedent transfers or relinquishes the right or interest.
2. With respect to a power of appointment over property, when the power terminates by exercise, release, lapse, default or otherwise.
3. With respect to a power of appointment under sub. (2) (d), when the power terminates by exercise or release.
(b) The augmented deferred marital property estate includes the value of any deferred marital property transferred by the decedent within the 2 years immediately preceding the decedent's death, including the following:
1. Deferred marital property that passed as a result of the termination of a right or interest in, or power of appointment over, property that would have been included in the augmented deferred marital property estate under subs. (2) (a), (b) or (d) or (3), if the right, interest or power had not terminated until the decedent's death. The amount included is the value of the property that would have been included if the property were valued at the time the right, interest or power terminated.
2. Transfers by the decedent of or relating to the deferred marital property component of an insurance policy on the life of the decedent, if the proceeds would have been included under sub. (2) (c) had the transfer not occurred. The amount included is the value of the insurance proceeds to the extent that they were payable at the decedent's death.
3. Any transfer of deferred marital property to the extent that it is not otherwise included in the augmented deferred marital property estate. The amount included is the value of the property at the time of the transfer, but only to the extent that the aggregate transfers to any one donee in either of the 2 years exceeded $10,000.
History: 1985 a. 37; 1987 a. 393; 1997 a. 188.