SOCIAL SECURITY 2023 UPDATE SSI FOR NYS RESIDENTS Individual $1,001/month Couple $1,475/month MAXIMUM TAXABLE…
** This article has been revised from its original version which was published on February 11, 2019.
The Right of Election of a surviving spouse of a New York decedent has been in existence since September 1, 1930. Prior to the enactment of New York’s Right of Election law, a surviving spouse possessed outdated dower and curtesy rights. Today, if a surviving spouse inherits less than one-third of the net estate, the surviving spouse has a Right of Election.
Our NY estate planning attorneys answer five frequently asked questions regarding the Right of Election of a surviving spouse:
1. What is New York’s Spousal Right of Election?
The surviving spouse of a New York decedent dying on or after September 1, 1992, has a personal Right of Election to the greater of $50,000, or one-third of the decedent’s net estate, calculated at the decedent’s date of death. This amount is known as the Elective Share.
The surviving spouse has the Right of Election unless the right is waived, is not timely asserted, or if the surviving spouse engaged in disqualifying conduct such as:
- Failure to support
2. How is the Spousal Right of Election Exercised?
The surviving spouse must serve a Notice of Election upon the executor or administrator and record the original with the Surrogate’s Court. The Right of Election must be exercised within six months of the issuance of Letters Testamentary or Letters of Administration appointing an executor or administrator.
The court can extend the time to file the Notice of Election for six months and can grant further extensions with reasonable cause, but not beyond two years after the decedent’s death.
3. How is the Elective Share Calculated?
The decedent’s net estate is calculated by including all probate assets (passing under a Last Will and Testament or via Intestacy) and certain non-probate assets (passing by operation of law), less debts, estate administration expenses, and funeral expenses. Estate taxes aren’t deducted. These non-probate assets are known as Testamentary Substitutes.
The surviving spouse is not entitled to interest on the Testamentary Substitutes during the estate administration process or to the specific property. The surviving spouse is entitled to receive money representing the date of death value of the property on a pro-rata basis from the beneficiaries.
4. What are Testamentary Substitutes?
- Gifts made in contemplation of death (revocable gifts which are subject to surviving a stated contingency)
- Outright gifts made in the last year of the decedent’s life (excluding annual exclusion gifts and gifts of direct tuition and medical payments)
- Totten Trusts (“In Trust For” bank accounts)
- Jointly owned property (including U.S. savings bonds and securities) to the extent of the decedent’s contribution:
- Certain pension and retirement plans
- Certain lifetime trusts and contracts (including annuities but excluding life insurance)
- General powers of appointment
5. Which Assets Received by a Surviving Spouse are Credited Toward the Satisfaction of the Elective Share?
Only absolute dispositions of property passing from a decedent to a surviving spouse will be credited toward the satisfaction of the Elective Share. An example of an “interest passing other than absolutely” is property that doesn’t consist of the decedent’s entire interest or interest in a trust or a trust equivalent created by the decedent. An example of a trust equivalent is a legal life estate in real property.
It’s easy to get confused about estate law and your spousal rights. Russo Law Group, P.C. can provide professional services to advise you. We invite you to take advantage of our comprehensive website as well as our free seminars and webinars to learn more about us. Please do not hesitate to contact us for a consultation with a NY estate planning attorney.