By: Attorney Gina C. Ziegelbauer
When someone dies, one of the first things loved ones are faced with is what to do with all of physical things your loved one owned. Sorting through a loved one’s tangible personal property can be an overwhelming task depending on how much stuff there is, the value of the property (monetary or sentimental), the number of heirs supposed to receive the items, and how well the heirs get along. Sometimes the question of “who gets what” can create the most conflict among family and even leave lasting resentments.
So how should a person plan for the distribution of their things? In legal terms, these physical items that a person owns are referred to “tangible personal property.” Tangible personal property includes items such as furniture, household goods, jewelry, photographs, antiques, appliances, tools, guns, machinery, vehicles, recreational vehicles, personal effects, and even pets. Tangible personal property does not include real estate or money assets like cash, stocks, bank accounts, investment accounts, etc.
Your Will or Living Trust can include specific bequests or gifts of certain items to certain people. While this ensures that your wishes will be followed, if you change your mind, you would have to prepare and sign an amendment to your Will or Trust. In most cases, rather than including a number of specific bequests in the body of your Will or Trust, a Tangible Personal Property Memorandum is just as effective but much simpler to change. Wisconsin law allows a Tangible Personal Property Memorandum to be used to list any number of items and the recipient of each. It’s a very efficient way to distribute your things because it’s really just a list that can be relatively informal, even handwritten, and can changed throughout your lifetime.
Although the Tangible Personal Property Memorandum does not require a specific form to be used, there are certain requirement for the memorandum to be legally enforceable. For instance, the memorandum must be referenced in your Will. Additionally, the personal property items and each recipient must be specifically identified. Finally, you must sign and date the memorandum. The memorandum does not need to be witnessed or notarized to be valid. You should leave the memorandum with your Will and other important documents so that when you die, your personal representative can easily locate the list and distribute the property accordingly.
It is important to note that this type of list is not required, and you certainly don’t need to create a comprehensive list or inventory of every item of personal property you own. The general default is that your tangible personal property will be split between the person(s) listed in your Will or according to the default laws if you don’t have a Will. Then it is up to your personal representative and the beneficiaries to work out who gets what. The separate memorandum is useful for items you know may cause conflict (like who gets mom’s wedding ring or dad’s gun collection, etc.) or particularly sentimental or valuable items that may be fought over or that you’ve verbally told someone they’ll receive. You may also decide to gift some of those items when you’re alive. If you do gift an item during your life that you think kids or others may fight over, it’s a good idea to make a note or record of the gift to avoid questions about where the sought-after item ended up after you pass.
Overall, many people are surprised to learn how much conflict can arise just from their “stuff.” In fact, many clients I talk to assume the kids will just get a dumpster and toss everything! But even if you think your things aren’t worth much money-wise, your physical things are sometimes the things people want to hold on to most. Planning for distribution of your tangible personal property as part of your overall estate plan can prevent surprises or hard feelings after you pass.
The information in this blog is specific to Wisconsin law and general in nature. It is not intended to be legal or tax advice.