NY State Senate Bill 2015-S6712

Senate Bill S6712

2015-2016 Legislative Session

Provides for the testimentary establishment of an elective share qualifying supplemental needs trust for a spouse who is disabled

download bill text pdf

Archive: Last Bill Status - In Senate Committee Judiciary Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Feb 08, 2016	referred to judiciary

2015-S6712 (ACTIVE) - Details

Current Committee:: Senate Judiciary
Law Section:: Estates, Powers and Trusts Law
Laws Affected:: Amd §5-1.1-A, EPT L

2015-S6712 (ACTIVE) - Summary

Provides for the testimentary establishment of an elective share qualifying supplemental needs trust for a spouse who is disabled.

2015-S6712 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S6712

 TITLE OF BILL :  An act to amend the estates, powers and trusts law,
in relation to elective share qualifying supplemental needs trusts

 PURPOSE :

To provide for the establishment of elective share supplemental needs
trusts.

 SUMMARY OF PROVISIONS :

Section one adds a new (f) to the Estates, Powers and Trusts Law
(EPTL) § 5-1.1-A to provide for an "elective share qualifying
supplemental needs trust" which is a trust established by the
decedent's will for a spouse who, at the time of the decedent's death,
has a severe and chronic or persistent disability, is suffering from a
degenerative condition, or resides in an assisted living facility or
nursing home. The elective share qualifying supplemental needs trust
shall not reduce the net elective share if the surviving spouse, or
someone lawfully acting on behalf of the surviving spouse, serves an
objection.

Section two provides that this act take effect 30 days after
enactment.

 JUSTIFICATION :

This bill amends the EPTL to provide that a surviving spouse's
elective share may be held in a Qualifying Supplemental Needs Trust.
Pursuant to current law, a surviving spouse is entitled to an elective
share amount from his or her deceased spouse's estate. An individual
under age sixty-five (65) can place his or her elective share received
from a deceased spouse into a self-funded, pay-back supplemental needs
trust without affecting his or her eligibility for Medicaid. In
contrast, someone who is age sixty-five (65) or over does not have
that same option.

This legislation would permit a testator or testatrix to place a
surviving spouse's elective share into a pay-back supplemental needs
trust for the benefit of the surviving spouse, without affecting the
surviving spouse's eligibility for Medicaid. This amendment will
preserve the right of a surviving spouse to benefit from an elective
share of a predeceased spouse's estate, while being able to obtain or
continue to receive government benefits. The proposed amendment does
not affect the surviving spouse's right to receive the elective share
outright as opposed to being placed into a Qualifying Supplemental
Needs Trust.

 LEGISLATIVE HISTORY :

New bill.

 FISCAL IMPLICATIONS :

None.

 EFFECTIVE DATE :
30 days after enactment.

2015-S6712 (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  6712

                            I N  S E N A T E

                            February 8, 2016
                               ___________

Introduced  by  Sen.  HANNON -- read twice and ordered printed, and when
  printed to be committed to the Committee on Judiciary

AN ACT to amend the estates, powers and trusts law, in relation to elec-
  tive share qualifying supplemental needs trusts

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Section  5-1.1-A of the estates, powers and trusts law is
amended by adding a new paragraph (f) to read as follows:
  (F) ELECTIVE SHARE QUALIFYING SUPPLEMENTAL NEEDS TRUSTS.
  (1) AN "ELECTIVE SHARE QUALIFYING SUPPLEMENTAL NEEDS TRUST" IS A TRUST
ESTABLISHED BY THE DECEDENT'S WILL FOR A SPOUSE  WHO,  AT  THE  TIME  OF
DECEDENT'S  DEATH, HAS A MENTAL ILLNESS, AS DEFINED IN SUBPARAGRAPH 3 OR
A SEVERE AND CHRONIC OR PERSISTENT DISABILITY, AS  DEFINED  IN  SUBPARA-
GRAPH  4  OF  PARAGRAPH  (A)  OF SECTION 7-1.12 OF THIS CHAPTER, OR IS A
BLIND OR DISABLED INDIVIDUAL AS DEFINED IN 42 U.S.C. SECTION 1382C(A)(2)
OR (3), OR WHO IS SUFFERING FROM A  DEGENERATIVE  CONDITION  OR  WHO  IS
RESIDING IN AN ASSISTED LIVING FACILITY OR A NURSING HOME; AND
  (2) WHICH PROVIDES THAT:
  (A)  (I)  THE NET INCOME SHALL BE DISTRIBUTED TO OR FOR THE BENEFIT OF
THE SURVIVING SPOUSE AT LEAST QUARTER ANNUALLY; AND
  (II) DURING THE SURVIVING SPOUSE'S LIFE, OTHER THAN THE PAYMENT OF ALL
LAWFUL TRUST EXPENSES, CHARGES, TAXES AND (IF THE TRUST DIRECTS  PREPAY-
MENT  OF THE SPOUSE'S FUNERAL EXPENSES) PREPAID FUNERAL EXPENSES FOR THE
SURVIVING SPOUSE, NO DISTRIBUTIONS OF PRINCIPAL MAY BE MADE  FOR  ANYONE
OTHER THAN THE SURVIVING SPOUSE;
  (B) ANY DISTRIBUTION OF THE PRINCIPAL OF THE TRUST TO OR FOR THE BENE-
FIT  OF  THE  SURVIVING SPOUSE DURING THE SURVIVING SPOUSE'S LIFE MAY BE
MADE FOR THE SUPPLEMENTAL NEEDS OF THE  SURVIVING  SPOUSE  ONLY  IN  THE
DISCRETION  OF ONE OR MORE TRUSTEES, LESS THAN HALF OF WHOM ARE INELIGI-
BLE FAMILY TRUSTEES. "INELIGIBLE FAMILY TRUSTEES" INCLUDE THE DECEDENT'S
GRANDPARENTS AND ANY DESCENDANTS OF THE DECEDENT'S GRANDPARENTS WHO  ARE
NOT  ALSO  DESCENDANTS OF THE SURVIVING SPOUSE.  INELIGIBLE FAMILY TRUS-
TEES ALSO INCLUDE SPOUSES OF ANY DESCENDANTS OF THE DECEDENT'S GRANDPAR-
ENTS WHO ARE NOT ALSO DESCENDANTS OF THE SURVIVING SPOUSE;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.

                                                           LBD13924-02-6

S. 6712                             2

  (C) PRINCIPAL SHALL NOT BE USED TO PAY FOR ANY  EXPENSES  WHICH  WOULD
OTHERWISE  BE  PAID  BY  GOVERNMENT BENEFITS OR ASSISTANCE FOR WHICH THE
SURVIVING SPOUSE MAY OTHERWISE BE ELIGIBLE, EXCEPT THAT THE TESTATOR  OR
TESTATRIX  HAS  THE  OPTION  OF GIVING THE TRUSTEE THE AUTHORITY TO MAKE
DISTRIBUTIONS  OF PRINCIPAL FOR FOOD OR SHELTER AS LONG AS THE PROVISION
OF CLAUSES (I) AND (II) OF SUBPARAGRAPH 5 OF PARAGRAPH  (B)  OF  SECTION
7-1.12 OF THIS CHAPTER ARE INCORPORATED INTO THE TRUST; AND
  (D) AT THE DEATH OF THE SURVIVING SPOUSE, AFTER THE PAYMENT OF PREPAID
FUNERAL  EXPENSES  (IF  DIRECTED  IN  THE  TRUST),  TRUST ADMINISTRATION
EXPENSES, TAXES, AND ESTATE TAXES, THE DEPARTMENT  OF  HEALTH  SHALL  BE
REPAID  FOR ANY MEDICAL ASSISTANCE GRANTED PURSUANT TO TITLE 11 OF ARTI-
CLE 5 OF THE SOCIAL SERVICES LAW TO THE SURVIVING SPOUSE AFTER THE  DATE
OF  DEATH  OF  THE  DESCENDANT,  AND  THAT THE BALANCE, IF ANY, SHALL BE
DISTRIBUTED AS PROVIDED IN THE TRUST.
  (3) THE PROVISIONS OF SUBPARAGRAPHS 1, 2, 3 AND 4 OF PARAGRAPH (B)  OF
SECTION 7-1.12 OF THIS CHAPTER SHALL BE APPLICABLE TO THE ELECTIVE SHARE
QUALIFYING  SUPPLEMENTAL  NEEDS  TRUST,  WITH  THE  EXCEPTION THAT THOSE
PROVISIONS SHALL NOT BE  APPLICABLE  TO  THE  INCOME  (OR  THE  UNITRUST
AMOUNT) DISTRIBUTABLE TO THE SURVIVING SPOUSE.
  (4)  THE  ELECTIVE SHARE QUALIFYING SUPPLEMENTAL NEEDS TRUST SHALL NOT
REDUCE THE NET ELECTIVE SHARE AS DEFINED IN SUBPARAGRAPH 4 OF  PARAGRAPH
(A)  OF  THIS  SECTION  IF  THE  SURVIVING SPOUSE (OR ANY PERSON WHO MAY
LAWFULLY MAKE THE ELECTION UNDER THIS SECTION ON BEHALF OF THE SURVIVING
SPOUSE) SHALL SERVE AN OBJECTION TO HAVING THE ELECTIVE SHARE QUALIFYING
SUPPLEMENTAL NEEDS TRUST REDUCE THE SURVIVING SPOUSE'S  ELECTIVE  SHARE.
SUCH  OBJECTION SHALL BE MADE IN ACCORDANCE WITH THE PROCEDURE FOR EXER-
CISE OF RIGHT OF ELECTION UNDER PARAGRAPH (D) OF THIS SECTION AS MAY  BE
AMENDED.
  (A)  THE  FAILURE  OF  THE  SURVIVING SPOUSE OR HIS OR HER GUARDIAN TO
INTERPOSE SUCH AN OBJECTION SHALL NOT BE DEEMED A TRANSFER  FOR  MEDICAL
ASSISTANCE PURPOSES.
  (B)  UNLESS THE DECEDENT HAS PROVIDED OTHERWISE, IF A SURVIVING SPOUSE
OBJECTS PURSUANT TO THIS PARAGRAPH, SUCH OBJECTION SHALL HAVE  THE  SAME
EFFECT  WITH RESPECT TO THE ELECTIVE SHARE QUALIFYING SUPPLEMENTAL NEEDS
TRUST AS THOUGH THE SPOUSE DIED ON THE SAME DATE BUT IMMEDIATELY  BEFORE
THE DEATH OF THE DECEDENT.
  S  2.  This  act shall take effect on the thirtieth day after it shall
have become a law.

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