Elective Share Statute

Question 1

Who is entitled to an elective share?

Answer 1

A surviving spouse of a decedent/testator.

Question 2

What is the basic elective share calculation?

Answer 2

The minimum amount a surviving spouse can get is the GREATER OF:
$50,000 or 1/3 of the testator’s net probate estate.

Question 3

What is the net probate estate?

Answer 3

the value of the estate after payment of debts but before payment of property taxes

Question 4

What happens if the spouse does not get her elective share?

Answer 4

The other beneficiaries contribute pro rata.

Question 5

What does a surviving spouse take if the decedent died without a will?

Answer 5

His or her intestate share -
the entire estate if decedent is not survived by issue,

or $50,000 + 1/2 the remainder if decedent is survived by issue.

Use elective share when there is a will being probated.

Question 6

Can a testator still “disinherit” their spouse by putting all their money in non-probate assets?

Answer 6

No - “testamentary substitutes” are added into the net probate estate to determine a spouse’s elective share (this is called the elective share estate)

Question 7

What kinds of non-probate assets are considered testamentary substitutes?

Answer 7

TS LEG UP

• Totten trusts
• Survivorship estates
• Lifetime transfers with strings attached
• Employee benefit pensions, profit sharing, and deferred compensation plans
• Gifts made within 1 year of death
• US Government bonds and other Payable on Death arrangements
• Powers of appointment (presently exercisable)

Question 8

What are “lifetime transfers with strings attached” - which are T-Subs?

Answer 8

Revocable trusts

Transfers made during marriage where testator retained a life estate (if transferred on/after 9/1/92).

Question 9

What are the limitations on “gifts made within 1 year of death,” which are T-Subs?

Answer 9

It only applies to gifts greater than $14,000

and any gifts made causa mortis (in anticipation of death)

Question 10

What are the non-testamentary substitutes?

Answer 10

LOGPIT

• Life insurance
• One half of qualified pension and profit sharing benefits
• Gifts of less than $14,000 made within 1 year of death, so long as not causa mortis
• Pre-marriage irrevocable trusts
• Irrevocable transfers made more than 1 year before death
• Irrevocable transfers made during marriage, where testator has a life estate.

Question 11

How do you calculate the value of a T-sub when it is a survivorship estate between testator and a third party?

Answer 11

Use the consideration furnished test - add in whatever amount the testator put in (will either be all or nothing on the bar).

Question 12

How do you calculate the value of a T-sub when it is a survivorship estate between testator and the surviving spouse?

Answer 12

Take one half the value no matter who paid for the asset.

Question 13

In NY, how do you calculate a joint bank account between the testator and surviving spouse?

Answer 13

Treat 1/2 as surviving spouse’s and 1/2 as testator’s - for purposes of calculating the value of the T-Sub = 1/2 the value of the account.

Question 14

What amount, if any, of a pre-marriage survivorship estate between testator and a third party goes into the T-sub calculation?

Answer 14

Because it is pre-marriage, and pre-marriage property doesn’t count as a T-sub: use the consideration furnished test - but the MOST that you would ever add is 1/2.

Question 15

What is the formula for calculating the other beneficiaries’ pro rata share?

Answer 15

Divide the amount the spouse needs to satisfy her elective share by the remaining assets.

Then multiply that fraction by each person getting an asset to see what their individual contribution must be.

Question 16

If a beneficiary has to pay in, pro rata, to the spouse’s elective share, but they only got real property - do they have to give up the property?

Answer 16

No - they can pay the value of their share in cash and can keep the property.

Question 17

What is the role of a life estate or other terminable interest in determining a surviving spouse’s elective share?

Answer 17

Wills executed post Sept. 1, 1994: a life estate or other terminable interest WILL NOT satisfy a surviving spouse’s elective share entitlement.

Question 18

What happens to a life estate in real property or in an income interest in a trust when the spouse files for an elective share?

Answer 18

Treat the spouse as having predeceased the testator for purposes of the trust - kill the trust and accelerate the estate to the remaindermen. Give the spouse her elective share.

Question 19

If a spouse is given more than what her elective share would be AND a lifetime interest in an trust income or estate - what happens to that lifetime estate?

Answer 19

It can stay - it’s only when the spouse files for an elective share that the trust is canceled and accelerated to the remaindermen.

Question 20

What is the procedure for claiming an elective share if the estate is admitted to probate?

Answer 20

surviving spouse’s notice of election must be filed within 6 months after “Letters” are issues by the Surrogate’s Court at the start of the probate proceeding.

Question 21

What is the procedure for claiming an elective share if there is no estate administration?

Answer 21

The notice of election must be filed no later than 2 years after decedent’s death.

Question 22

How is a surviving spouse’s right of election affected by incapacity?

Answer 22

The incapacitated surviving spouse can elect via guardian or conservator - with court approval.

Question 23

Can a spouse waive the right of election?

Answer 23

Yes - either before or after the marriage (pre-nup), and also as to particular will or testamentary substitute or testamentary substitutes generally.

Question 24

If a spouse has waived the right of election as to testamentary substitutes generally, have they also waived the right to specific gifts?

Answer 24

No - a spouse only waives their right to specific gifts in a will by specifically waiving the right as to that gift.

This rule also applies to “exempt property.”

Question 25

Does a spouse who is domiciled in FL at the time of testator’s death have a right of election if testator died with his domicile as NY?

Answer 25

Yes - a surviving spouse has a right of election if decedent was domiciled in NY at the time of death.

Question 26

Does a spouse who is domiciled in NY at the time of testator’s death have a right of election if testator’s domicile at death was TX?

Answer 26

No - a surviving spouse only has a right of election if the decedent was domiciled in NY at the time of death.

Unless - the will expressly states in the will that the disposition of property is to be governed by NY law.

Question 27

If T is domiciled in CA at the time of his death, but his will has an express provision that the distribution of property is to be governed by NY law - does his surviving spouse have a right of election?

Answer 27

Yes - an express provision in the will that says property should be distributed based on NY law will allow a spouse to claim an elective share even if testator’s domicile was not NY at death.

Question 28

When a testator’s will is admitted to probate in CA, but testator has real property in NY, how is that property distributed?

Answer 28

In an ancillary administrative proceeding following NY laws - which must be used to clear title of real property located in NY.

Question 29

If testator is domiciled in GA at death but owns real property in NY - can his surviving wife claim an elective share of that real property?

Answer 29

No - the will is governed by GA law, and the surviving spouse cannot claim an elective share because testator was domiciled in GA at the time of death.

Question 30

If testator is domiciled in NY at death but owns real property in FL, can his surviving spouse claim an elective share that includes the value of the FL property?

Answer 30

Yes - even though an ancillary proceeding in FL will have to take place to decide the ownership of the FL property - the net probate estate will include the value of the FL property because NY law governs everything “under the will.”

Question 31

If an item qualifies as exempt property - what does that mean?

Answer 31

Exempt property goes to the surviving spouse first - off the top - before proceeding with intestacy or elective share, and even before some creditors.

Question 32

What is the maximum value of exempt property a surviving spouse can get?

Answer 32

$92,500

Question 33

What property is considered “exempt”?

Answer 33

1. one car (up to $25k)
2. furniture, appliances, and electronics (up to $20k)
3. cash allowance, not subject to creditors’ claims (up to $25k)
4. Animals, farm machinery (up to $20k)
5. Books, dvds, cds, etc. (up to $2,500)

Question 34

If testator dies with children but no surviving spouse, who gets the exempt property?

Answer 34

any children under 21.

Question 35

What circumstances disqualify a surviving spouse from taking an elective share?

Answer 35

DISMAL
Divorce or annulment (final decree)
Invalid divorce or annulment procured by surviving spouse
Separation Decree rendered against surviving spouse
Marriage is void (incest or bigamy)
Abandonment or Lack of Support (surviving spouse abandoned or failed to support testator)