Westchester Estate Planning Built Around the House, the Co-op and New York's Estate Tax Cliff

Yes. A will must generally be admitted to probate in the Westchester County Surrogate's Court before the named executor can act. Under the SCPA the court issues letters testamentary authorising the executor to collect assets, pay debts and distribute property. Assets held in a funded trust, or passing by beneficiary designation or right of survivorship, generally move outside probate and are not part of that proceeding.

New York imposes its own estate tax separate from the federal tax, and it works as a cliff: once the estate exceeds the exemption by more than about five percent, the exemption is lost and the entire estate is taxed. Because Westchester property values are high, a house plus retirement accounts can cross that line in an estate the family never considered large. Trust planning and lifetime gifting can reduce or eliminate the exposure, but only if arranged in advance.

An uncontested estate with clear title and cooperative distributees commonly takes on the order of seven to nine months from filing to distribution. Delay usually comes from three places: distributees who cannot be located or served, real property that must be appraised or sold, and creditor claims, including Medicaid liens, that must be resolved first. A contested will or a taxable estate can extend matters considerably.

Commissions are set by statute, not negotiated. Under SCPA 2307 the rate is five percent of the first $100,000, four percent of the next $200,000, three percent of the next $700,000, two and one-half percent of the next $4,000,000, and two percent above $5,000,000. A family member serving as executor is entitled to the same commission as a professional, and the commission is separate from the estate's legal fees.

New York offers a voluntary administration when the decedent's solely owned personal property is under $50,000 and there is no real property in the decedent's name. The filing fee is nominal and the process is much faster. In practice the second condition defeats it for many Westchester families, because the house is usually the largest asset and it is usually in the decedent's name.

The most common objection is that the will was not executed with the formalities New York requires under EPTL 3-2.1 — signature, witnesses and the sequence of the signing ceremony. After that come claims that the testator lacked capacity, or was subject to undue influence. A will drafted and supervised by counsel, with the execution properly documented, is materially harder to attack, which is the practical argument against do-it-yourself forms.

Not entirely. A surviving spouse has a right of election to take a statutory share of the estate regardless of what the will provides. The election is not automatic: it must be filed with the Surrogate's Court within six months of the issuance of letters and in no event more than two years after the date of death. Missing those deadlines forfeits the right, so a surviving spouse who has been left out should take advice quickly.

It does. A cooperative apartment is shares in a corporation plus a proprietary lease, not real estate, and the transfer runs through the co-op board rather than a deed. Some boards will not accept ownership by a trust, or will accept it only on conditions, which can defeat a plan that would work perfectly for a house. We read the proprietary lease and house rules before drafting so the structure matches what the board will actually approve.

Usually not. An Article 81 guardianship under the Mental Hygiene Law, sought when an adult can no longer manage personal or financial affairs, is generally brought in Supreme Court, with limited exceptions where the person is already a beneficiary of an estate or trust. Most guardianships are also avoidable: a durable power of attorney and a health care proxy executed while capacity remains accomplish much of the same result without a court proceeding.

Not by itself, and it can cost more than it saves. New York pulls back into the taxable estate gifts made within three years of death, so a deathbed transfer does not work. A lifetime gift also carries over your cost basis instead of receiving the step-up in basis at death, which can create a capital gains bill larger than the estate tax it was meant to avoid. Gifting is a real tool, but it belongs in a plan made years ahead, not in a reaction to a diagnosis.

It depends on domicile, which is a question of intent proved by facts rather than by a declaration. New York looks at where you spend your days, where your home and possessions are, where you vote, register vehicles and see your doctors. A former New York resident who keeps a Westchester house and returns for half the year is a frequent target of a residency audit. New York also taxes real property physically located here regardless of domicile, so a retained house remains exposed.

Medicaid does not take the house during her lifetime while she intends to return home, but the county may place a lien and, after death, the state may seek recovery from the estate for what it paid. Whether the house is reachable depends on how it is titled, who lives in it, and whether a protective transfer was made long enough in advance. That is why the planning conversation belongs several years before care is needed, not during the hospital discharge.

The Surrogate's Court filing fee is set by SCPA 2402 on a sliding scale by the size of the estate, from a nominal amount for a small estate up to $1,250 for estates of $500,000 or more. That fee is the smallest part. Executor commissions under SCPA 2307, legal fees, appraisals of real property, and the cost of locating distributees usually exceed it several times over, and all of them come out of the estate before anyone inherits.