Estate Planning Isn’t Just For The Elderly

Happy, smiling couple in their sixties.

How the Use of a Revocable or Irrevocable Trust Can Simplify the Conveyance of a Second Home Located in Another State Upon Death

By: Anthony J. Enea, Esq*

According to the Pew Research Center, everyday approximately ten thousand baby boomers reach sixty-five years of age. As the approximately sixty-five million surviving members of the baby boomer generation (those born between 1946 and 1964) retire, it is not unusual for them to own homes in multiple states. In fact, it is very common for a retiree in New York to own a second home in Florida, Arizona, or any other state where they can spend their winters in a milder climate, while continuing to own a home in New York.

Although the second home may be jointly titled with one’s spouse with rights of survivorship, upon the demise of the joint title holder the home will automatically transfer to the surviving spouse, thus, becoming titled solely in the name of the surviving spouse. If this is the case and/or if the second home is titled only in one’s sole name, the result will be additional complexities and costs at the time of death of the sole owner. For example, it would be necessary that a Probate proceeding or Administrative proceeding (if there was no Last Will and Testament) be filed in the county where one died in New York (the state of the decedent’s domicile), but also necessitates an Ancillary Probate or Ancillary Administration Proceeding be commenced in the state where the second home is located. This will require that an Executor, or Administrator, be first appointed by the Court in New York and receive Letters of Testamentary or Letters of Administration from the Surrogate’s Court here and then retain an attorney in the state where the second home is located to commence an Ancillary Probate or Administration proceeding in that state, so as to allow the second home to be sold and/or conveyed to the decedent’s named beneficiaries under his or her Last Will, or heirs at law in an Administration proceeding.

The need for an Ancillary Probate or Ancillary Administration proceeding will result in additional legal fees, court filing fees, maintenance and upkeep for the second home as a result of delays in being able to sell the home after the owner’s demise. These delays and expenses can all be avoided if one’s primary residence and second home are owned by either a Revocable Living Trust and/or an Irrevocable Trust (used for long-term care and Medicaid assets protection planning purposes).

If one’s primary residence and second home have been transferred to either a Revocable Living Trust or an Irrevocable Trust during one’s life, then upon one’s demise there is no need to commence a Probate proceeding for the primary residence or an Ancillary Probate proceeding for the second home in the state where the second home is located.

The trustee(s) named in either Trust will be given the immediate ability to list and market for sale either the primary residence and/or second home, and if they believe it is appropriate to do so (after all bills and taxes have been paid) convey the homes to the named beneficiaries. There are no court filling fees required for either home and no court delays.

Having the ability to avoid the expensive and time-consuming Ancillary Probate and/or Administration proceeding by utilizing a Trust to hold title to one’s home and other assets is invaluable. In spite of best efforts by attorneys and the Courts to minimize the delays and complexities of a Probate and/or Administration proceeding, they are often inevitable. For example, if one were to pass and is survived by a spouse, child, and/or grandchild that is a beneficiary under a Last Will or an heir at law in an Administration proceeding that is a “person under a disability”, it would be necessary for said person to be listed as such in the court papers, thus, necessitating appointment of a Guardian Ad Litem in the proceeding to represent and protect the disabled person’s interests in the proceeding. This results in additional court delays as the Guardian Ad Litem needs to file his or her report with the Court and will also be entitled to a fee for his or her services. Again, a cost and complexity that could have been easily avoided with the use of a Revocable or Irrevocable Trust.

*Anthony J. Enea, Esq. is a member of the firm of Enea, Scanlan & Sirignano, LLP of White Plains, New York. His office is centrally located in White Plains and he has a home office in Somers, New York, 914-269-2367.

Mr. Enea is the Past Chair of the Elder Law Section of the New York State Bar Association (NYSBA).

Mr. Enea is the Past President and a founding member of the New York Chapter of the National Academy of Elder Law Attorneys (NAELA). He is also a member of the Council of Advanced Practitioners of the National Academy of Elder Law Attorneys.

Mr. Enea is the President of the Westchester Bar Foundation and a Past President of the Westchester County Bar Association.

Enea, Scanlan & Sirignano, LLP