Elective Share Statute

Question 1

purpose of the anti-lapse

Answer 1

to protect the surviving spouse against disinheritance by giving him or her a minimum share of the testator’s probate estate

Question 2

what is the the elective share

Answer 2

is 50k or the greater of 1/3 of the estate

Question 3

calculating the amount payable: in theory the elective share is only applied to the testator’s net probate estate

Answer 3

net probate estate– the value of the estate after payments of debts, but before payment of estate taxes (after debt, before taxes)

Question 4

what is the rule?

Answer 4

if the elective share amount is not satisfied for the surviving spouse others contribute proportionally or pro-rata

Question 5

who contributes to payment?

Answer 5

1) beneficiaries under the will
2) beneficiaries of “testamentary substitutes” and/ or #)
3) intestate distributees

Question 6

Testamentary Substitutes

Answer 6

1) Context and rule: to prvent a testator from defeating the elective share statute by transferring his estate through non-probate assets, the ELECTIVE SHARE includes the PROBATE estate and TESTAMENTARY SUBSTITUTES– collectively known as the AUGMENTED estate or the ELECTIVE SHARE ESTATE

Question 7

TESTAMENTARY SUBSTITUTES

Answer 7

Remember “Testamentary substitutes need a LEG UP”

T== totten trusts
S== survivorship estates
L== lifetime transfers w/ strings attached
E== employee pension, profit-sharing, and deferred compensation plans
G== gifts made within one year of death
U== U.S. govt. bonds and other POD (pay on death) arrangements

P== powers of appointment

Question 8

Totten trusts

Answer 8

including bank accounts in the testator’s name in trust for another (e.g. A , Trustee for B) and payable on death securities

Question 9

survivorship estates

Answer 9

includes joint tenancies, tenancies by the entirety

Question 10

lifetime transfers with strings attached

Answer 10

where testator retains power to revoke, invade consume

Question 11

employee pension/ profit sharing

Answer 11

if the plan is called a “qualified plan” only half is a T-sub regardless of beneficiary

Question 12

gifts made within one year of deatrh

Answer 12

gifts in excess of $14,000 (annual gift tax exclusion)

gifts made in causa mortis (in fear of impending death

Question 13

U.S. govt. bonds and other POD (“pay on death”) arrangements

Answer 13

are T-subs!

Question 14

powers of appointment

Answer 14

property over which the testator has a presently exercisable general power of appointment

Question 15

Rule of thumb re: T-Subs

Answer 15

generally if Tm the testator has an interest in the property, it’s a T-sub, thus almost all non-probate transfers are T-subs

Question 16

NOT- TESTAMENTARY SUBSTITUTES

Acronym is LOGPIT

Answer 16

L== life insurance policies
O==one half of a qualified pension and profit sharing benefits (if beneficiary named before Sept. 1, 1992)
G==Gifts of less than $14,000 made within one year of death, except causa mortis gifts
P== pre marriage gifts
I== irrevocable transfers made more than one year before death
T== irrevocable made during the marriage

Question 17

survivorship estates: testator and THIRD PARTY

Answer 17

Consideration furnished test applies, the surviving spouse has the burden of proving the amount of the decedent spouses contribution to the asset. Either the asset acquisition or the amount on deposit.

if the survivorship estate occurred before marriage–then the surviving spouse can only get half

Question 18

survivorship estates involving the testator and the SURVIVING SPOUSE

Answer 18

half is a T-sub

Question 19

ELECTIVE SHARE TRUSTS

Answer 19

See conviser mini

Question 20

ELECTIVE SHARE TRUSTS

Answer 20

See conviser mini

Question 21

Waiver

Answer 21

the right of election can be waived, has to be in writing signed and acknowledged before a notary.

Question 22

Exempt Property

Answer 22

items the surviving spouse gets first or off the top before doing anything else

Question 23

exempt personal property set aside

BAR EXAM TIP– mention exempt property on any question involving the surviving spouse

Answer 23

in addition to the elective share, the surviving spouse is entitled to exempt personal property up to $92,500 in value, including:

a. one car ( up to $25,000 in value)
b. furniture, appliances, electronics, etc. (up to$20,000 in value)
c. cash allowances (up to$25,000; not subject to creditor’s claims other than for funeral arrangements)
d. animals, farm machinery, tractors, etc. ($20,000); and
e. Books, dvds, cds, software, etc. (up to $2,500)

Question 24

Circumstances disqualifying spouse from taking the elective share (and exempt property)

Answer 24

(Same as in intestacy) DISMAL
D– Divorce: a final decree of divorce or annulment valid under New York law
I– invalid divorce/ annulment
S– separation decree (NOT agreement)
M– marriage is void, e.g incestuous or bigamous
AL– abandonment or lack of support– by the surviving spouse