Dealing with out-of-state property upon your husband’s death

by | Mar 8, 2018 | Estate Planning |

As years go by in a marriage, it is not unusual to find married couples holding title to recreational property in another state. Perhaps it was a cabin in Vermont the family enjoyed while the kids were young. Or it might have been a condo for wintering in Tampa. But as the years went by, holding onto the property no longer seemed so important. When one spouse died, the property automatically transferred to the surviving spouse, but selling it always seemed like such a bother. Or in the case of a time share, selling it proved impossible. But holding onto it when there is no one in the family who wants it can result in a headache in probate court someday.

If you are the surviving adult child of a parent who owned property out-of-state at the time of their death, chances are you will need to have the title transferred through ancillary probate; the name given to a second probate process dealing with property held outside of the State of New York. This post, we’ll explain some things about ancillary probate, including the best way to get through it and how to avoid it altogether if possible.

First, what is it?

The simplest way to understand ancillary probate is to know that real estate ownership is always subject to the laws of the state in which the property is located. The winter condo in Florida, for example, is subject to Florida laws regarding transfer of title. That means the executor of a will in New York may have to work with an executor in Florida to transfer the title through Florida probate. (In many cases, states make it possible to simply file a letter of authorization proving executor authority.) The requirements for many states are dependent upon many factors relative to the property, so no general conclusions should be made until you speak with an attorney in the state in which the property is located.

How to avoid putting your loved ones through ancillary probate

The easiest way to avoid making a family member put your out-of-state property through ancillary probate upon your death is to gift or sell the property while you still have your health.

If you intend to keep the property for use by future generations, you may want to put an adult child or grandchild’s name on the title with you. Under right of survivorship laws in most states, the property will automatically transfer upon your death. Of course, anyone on the title will also be co-liable for property taxes due and subject to the laws of property ownership in the state, which may include mandatory insurance, HOA fees, and utilities.

Depending upon the type of property, it may be possible to place the title in a revocable living trust. In many cases, you may still use the property and will be subject to all associated costs of ownership until your death, upon which time the property transfers to your choice of trust beneficiary, often a church or charitable organization.

Finally, it may be time to consider finding a family member who will be willing to assume the responsibility of ownership upon your death, but isn’t ready to take on the liability now. If you have a family member in mind, discuss signing a “transfer on death” deed, in which the property is (more or less) pre-probated to transfer to the assigned party upon your death.