There are certain things you can do in life but you cannot disinherit your spouse – unless……….there’s always an unless, right?
New York State law says no matter how much you hate each other during your marriage, you are still married and you take that into the grave because your spouse is entitled to a portion of your estate. The question is how much and what, if anything, can you do about it.
The answer is relatively simple. New York’s Estate Powers and Trusts Law, § 5-1.1-A states that your spouse may take his/her “elective share” based on the net worth of property, on the date of death, under § 5-1.1-A(b)(1), which includes most property such as: bank accounts, real property, brokerage accounts, investments, contracts, etc. The amount the surviving spouse is entitled to depends on the net value of the estate. The elective share “is the pecuniary amount equal to the greater of (i) fifty thousand dollars or, if the capital value of the net estate is less than fifty thousand dollars, such capital value, or (ii) one third of the net estate. In computing the net estate, debts, administration expenses and reasonable funeral expenses shall be deducted, but all estate taxes shall be disregarded, except that nothing contained herein relieves the surviving spouse from contributing to all such taxes the amounts apportioned against him or her under 2-1.8.”
Now, if you do not want to leave your spouse that much for whatever reason, then there are steps you must affirmatively take during your lifetime. Of course, the first one would be a divorce because the entry of a final judgment of divorce automatically disinherits each spouse but some contractual provision should be in place between the time the final divorce settlement is inked and when the clerk actually “enters” it because until the clerk takes that step, your spouse may be entitled to his/her elective share.
If divorce is not an option and you want to plan ahead, then a pre-nuptial agreement is the solution, whereby the husband and wife sign and agreement, waiving their elective right to a share of the other’spouse’s estate. By doing so, the waiving spouse is giving up substantial legal rights and therefore should be represented by separate counsel in drafting this agreement. The contract should also be executed in a recordable form with specific wording that would permit the document to be recorded by the county clerk if the need arises.
So, if you really don’t want to leave him or her a dime………..then plan ahead now!