Elective Share Statute Flashcards
Who is entitled to an elective share?
A surviving spouse of a decedent/testator.
What is the basic elective share calculation?
The minimum amount a surviving spouse can get is the GREATER OF:
$50,000 or 1/3 of the testator’s net probate estate.
What is the net probate estate?
the value of the estate after payment of debts but before payment of property taxes
What happens if the spouse does not get her elective share?
The other beneficiaries contribute pro rata.
What does a surviving spouse take if the decedent died without a will?
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.
Can a testator still “disinherit” their spouse by putting all their money in non-probate assets?
No - “testamentary substitutes” are added into the net probate estate to determine a spouse’s elective share (this is called the elective share estate)
What kinds of non-probate assets are considered testamentary substitutes?
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)
What are “lifetime transfers with strings attached” - which are T-Subs?
Revocable trusts
Transfers made during marriage where testator retained a life estate (if transferred on/after 9/1/92).
What are the limitations on “gifts made within 1 year of death,” which are T-Subs?
It only applies to gifts greater than $14,000
and any gifts made causa mortis (in anticipation of death)
What are the non-testamentary substitutes?
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.
How do you calculate the value of a T-sub when it is a survivorship estate between testator and a third party?
Use the consideration furnished test - add in whatever amount the testator put in (will either be all or nothing on the bar).
How do you calculate the value of a T-sub when it is a survivorship estate between testator and the surviving spouse?
Take one half the value no matter who paid for the asset.
In NY, how do you calculate a joint bank account between the testator and surviving spouse?
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.
What amount, if any, of a pre-marriage survivorship estate between testator and a third party goes into the T-sub calculation?
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.
What is the formula for calculating the other beneficiaries’ pro rata share?
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.
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?
No - they can pay the value of their share in cash and can keep the property.
What is the role of a life estate or other terminable interest in determining a surviving spouse’s elective share?
Wills executed post Sept. 1, 1994: a life estate or other terminable interest WILL NOT satisfy a surviving spouse’s elective share entitlement.
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?
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.
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?
It can stay - it’s only when the spouse files for an elective share that the trust is canceled and accelerated to the remaindermen.
What is the procedure for claiming an elective share if the estate is admitted to probate?
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.
What is the procedure for claiming an elective share if there is no estate administration?
The notice of election must be filed no later than 2 years after decedent’s death.
How is a surviving spouse’s right of election affected by incapacity?
The incapacitated surviving spouse can elect via guardian or conservator - with court approval.
Can a spouse waive the right of election?
Yes - either before or after the marriage (pre-nup), and also as to particular will or testamentary substitute or testamentary substitutes generally.
If a spouse has waived the right of election as to testamentary substitutes generally, have they also waived the right to specific gifts?
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.”
