Legal Question in Wills and Trusts in New Jersey
Does a QPRT affect the value of the augmented estate for elective share purposes
The NJ elective share statute says a surviving spouse may elect one-third of the augmented estate. NJ Stat. Ann. Sec. 3B:8-1. According to the statute, the augmented estate includes the value of property transferred by the decedent at any time during marriage, to or for the benefit of any person other than the surviving spouse, to the extent that the decedent did not receive adequate and full consideration in money or money�s worth for the transfer, if the transfer is of any of the following types:
a. Any transfer made after May 28, 1980, under which the decedent retained at the time of his death the possession or enjoyment of, the property.
NJ Stat. Ann. Sec. 3B:8-3.
Does this NJ statute require that the residence be considered as part of the augmented estate for elective share purposes? If so, how is the property valued for elective share purposes?
2 Answers from Attorneys
Re: Does a QPRT affect the value of the augmented estate for elective share purp
I agree with Dale. Presuming a vaild QPRT, the decedent had received adequate consideration. If the time period covered by the QPRT has expired, the property validly belongs to the person(s) named. Thus, property validly transferred pursuant to a QPRT would not have any value in calculating the augmented estate, if the terms of the QPRT have been met. Keep in mind that pre-marital assets or assets inherited, even during the marriage, if maintained in separate registration, are also not part of the augmented estate, unless submitted to the marriage by joint registration or acquisition of marital assets.
Re: Does a QPRT affect the value of the augmented estate for elective share purp
Your title refers to a QPRT which is a Qualified Personal residence Trust whereby a property is transferred to a Trustee so that it can be removed from a persons estate depending upon how long they live. With a QPRT, the former owner(s) retains the right to rent the property but don't own it anymore so you question doen't apply if the property is the subject of a QPRT.
If the property is not in a QPRT, then if the house is owned in the names of both husband and wife "by the entireties" then it is not part of the estate and passes to the surviving spouse without regard to the statute you refer to. The deed doesn't have to say "by the entireties; as long as it doesn't contain language such as "tenants in commmon" but just refers to the parties as "husbaaand and wife, then what I have said above is what happens upon the death of one spouse.
You should consult with an Estate Planning attorney for furtherv details and advice.
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