Detailed Answer
Under Wisconsin law, a life estate grants a lifetime beneficiary—called a life tenant—the right to possess and use real property for the duration of the life tenant’s life. The future interest, known as the remainder interest, passes to one or more beneficiaries (remaindermen) when the life tenant dies. Key points under Wisconsin statutes include:
1. Creation and Definition of a Life Estate
- Wis. Stat. § 700.01 defines a life estate as an estate in real property limited to the duration of a natural person’s life. (Wis. Stat. § 700.01).
- Life estates can be created by deed, will, or court order. (Wis. Stat. § 700.02).
2. Rights and Duties of the Life Tenant
- Possession and Use: The life tenant may live on, lease, or collect rents and profits from the property.
- Maintenance and Repairs: The life tenant must not commit waste. They must perform ordinary repairs and keep the property in a substantially similar condition. (Wis. Stat. § 700.08).
- Taxes and Insurance: The life tenant generally pays property taxes and insurance to protect the remainder interest.
- No Right to Sell Fee Simple: Unless the remaindermen consent, the life tenant cannot convey a greater interest than the life estate.
3. Determining the Remainder Interest
A remainder interest is a future interest that becomes possessory only after the life tenant’s death. Under Wisconsin law:
- Designation in a Will: If a testator’s will grants a life estate and names a remainderman, that language controls who receives the fee simple on termination of the life estate.
- Residuary Clause: If the will leaves the remainder in the “residue” of the estate, Wis. Stat. § 853.01 governs distribution of the residuary estate to named beneficiaries. (Wis. Stat. § 853.01).
- Vested vs. Contingent Remainder: A remainder is vested if the remainderman is ascertained and no condition besides the life tenant’s death must occur. It is contingent if it depends on an additional condition (for example, “to my grandchildren who reach age 25”).
4. Example Scenario
Imagine Alice’s will states: “I give my lake cabin to my brother Bob for life, then to my niece Claire.” Bob becomes the life tenant with full possession and duty to maintain the cabin. Claire holds a vested remainder interest that automatically vests in fee simple upon Bob’s death.
Helpful Hints
- Review the exact wording of the will to see if the remainder is vested or contingent.
- Ensure the life tenant keeps accurate records of rents, repairs, taxes, and insurance.
- Understand that waste by the life tenant can expose them to liability from the remaindermen.
- Consult the local probate court to have the will admitted and interests formally recorded.
- Consider getting legal advice to draft clear life estate and remainder provisions that reflect your intentions.