CSG Law Alert: The Perils of Dying Without a Will in New York and New Jersey

Proper estate planning is critical for every individual regardless of one’s net worth.  If you die without a will (intestate), your assets will be distributed according to your state’s intestacy statute and in many cases, the outcome will result in unintended beneficiaries of your estate.  This article will present a brief overview of the intestacy statutes in New York and New Jersey, distinctions between the two and some of the surprising results of dying intestate in each state.

In New York, the laws of intestacy are governed by Estates, Powers and Trusts Law (EPTL) § 4-1.1, which identifies the beneficiaries (referred to as distributees in New York) of an intestate estate.   The first two subsections of EPTL § 4-1.1 address distributions of a decedent’s estate to a surviving spouse. Surprisingly, in New York, a surviving spouse of a decedent with children does not inherit the predeceased spouse’s entire estate. Instead, the surviving spouse receives $50,000 and one-half of the estate residue (the residue is the remainder of the estate after debts and expenses are paid). The balance of the residue of the decedent’s estate is distributed to decedent’s issue (i.e., descendants) by representation.1 As a result, the parent of an estranged child who dies without a will in New York may unwittingly leave such estranged child an inheritance. If a married couple has no issue, the surviving spouse takes the entire estate.2

An estate distributed by representation is divided into separate equal shares for each of the decedent’s children. First, each living child receives an equal share of the estate. Then, if any predeceased children of the decedent had living children, the predeceased children’s shares are divided equally among the living children of all the predeceased children of the decedent.  For example, assume a decedent died intestate in New York without a surviving spouse and had children A, B, C and D.  Children A and B survived the decedent, but children C and D predeceased the decedent.  Child C had two children (grandchild A and B) and child D had one child (grandchild C).  In this example, child A and B would each receive one-quarter (1/4) of the estate and grandchildren A, B and C would each receive one-sixth (1/6) of the estate.

The remaining subsections of EPTL § 4-1.1 address a decedent with no surviving spouse.  If a decedent has surviving issue but no surviving spouse, the estate is distributed to the decedent’s issue by representation.3 If a decedent has no surviving issue, but one or more surviving parents, the estate is distributed equally between the decedent’s parents, or all to the surviving parent.4 If a decedent has no surviving issue or parents, the estate is distributed to the issue of the decedent’s parents by representation.5 (EPTL. § 4-1.1. (a) (5))

There are several other significant factors to keep in mind when determining the rights of a distributee pursuant to the New York intestacy statute: (1) decedent’s relatives of half-blood are treated as if they were relatives of whole blood; (2) distributees of the decedent conceived before his or her death but born alive thereafter take as if they were born during the decedent’s lifetime; (3) the right of an adopted child to take a distributive share and the right of succession to the estate of an adopted child continue as provided in the domestic relations law and (4) a distributive share passing to a surviving spouse under the intestacy is in lieu of any right of dower to which a spouse may be entitled.6

New Jersey’s intestacy statute is governed by N.J.S.A. § 3B:5-3 and N.J.S.A. § 3B:5-and the distributions to intestate beneficiaries (referred to as heirs in New Jersey) vary significantly from its New York counterpart. For example, in New Jersey, a surviving spouse with the same issue7 as the decedent will inherit the entire estate.8 The surviving spouse will also take the entire estate if there is no issue of the decedent or parent of the decedent.9 However, if a decedent has a surviving spouse but no issue, the surviving spouse does not take the entire estate if the decedent is also survived by a parent.  In this instance, the surviving spouse inherits the first 25% of the estate (but not less than $50,000 nor more than $200,000), plus three-fourths of the balance of the estate.10 The decedent’s parent or parents inherit the remainder. As a result, a decedent with a surviving spouse but no issue that is estranged from a parent may unwittingly leave that parent an inheritance without a Will.

The New Jersey intestacy statute also distinguishes between spouses with uncommon children (i.e., mixed families). In New Jersey, if the surviving spouse has issue with the decedent but has any other issue that were not the decedent’s issue, the surviving spouse receives the first 25% of the estate (but not less than  $50,000 nor more than $200,000) plus one-half of the balance of the estate.11 The surviving spouse receives the same share as if the decedent had issue that were not the surviving spouse’s issue.12

As these provisions from the New York and New Jersey intestacy statutes demonstrate, if you do not consult an attorney to prepare estate planning documents, it is possible that a portion or all of your assets may pass in a manner that is contrary to your wishes. Proper planning allows you to control the ultimate disposition of your assets after your death, rather than have the law of your state of residence determine who will benefit from your assets.

1 EPTL § 4-1.1(a)(1)

2 EPTL § 4-1.1(a)(4)

3 EPTL § 4-1.1(a)(3)

4 EPTL § 4-1.1(a)(4)

5 EPTL § 4-1.1(a)(5)

6 EPTL § 4-1.1(b)-(e)

7 New Jersey statute refers to a decedent’s issue as “descendants”.  The terms are interchangeable.

8 N.J.S.A. § 3B:5-3(a)(2)

9 N.J.S.A. § 3B:5-3(a)(1)

10 N.J.S.A. § 3B:5-3 (b)

11 N.J.S.A. § 3B:5-3 (c)(1)

12 N.J.S.A. § 3B:5-3 (c)(2)

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