The Perils and Pitfalls of Owning a Co-op

As many of you know, I practice as a tax accountant as well as an elder law and estate planning attorney.  This blog is an example of the interdisciplinary nature of my practice.

On March 11, 2021, President Biden enacted the American Rescue Plan (“ARP”).  Oddly, certain provisions of the ARP relate back to 2020 and may have an impact on your 2020 income tax return.  Under the ARP, the first $10,200 of unemployment compensation, received in 2020, is tax-free so long as your 2020 adjusted gross income is less than $150,000.  If you are married, both you and your spouse may each exclude $10,200.00.

Seeing that two-thirds of the tax filing season has elapsed, this relief creates somewhat of a tax filing headache for those of you who have already filed your 2020 tax returns.  Unfortunately, you will need to amend your 2020 tax returns to obtain this benefit.  If you are in the process of preparing your 2020 tax returns with an accountant, you should remind your accountant that you have unemployment compensation since this is crunch time for accountants and many may be unaware of this retroactive law.

Dear Mr. Di Costanzo: Can my spouse access our jointly owned safe deposit box after my death?

It is common practice in New York for banks to “seal” a safe deposit box upon the death of an owner.  Surprisingly, this practice applies even in situations where there are joint owners.  Many people who own safe deposit boxes as joint owners, for instance a husband and wife, mistakenly believe that the surviving owner has free access to the contents of the box after the death of the first owner.  This is not the case in New York.  Unlike joint bank accounts, there is no right of survivorship feature with safe deposit boxes.

New York banking law provides that access to a safe deposit box must be granted to an Executor, Administrator, Trustee or Guardian.  This could be a cumbersome process for those who have no reason to probate or administer an estate other than to access a safe deposit box.

Making matters more complicated, the Last Will and Testament of the decedent may be in the safe deposit box.  To probate or administer the decedent’s estate, the original must be presented to the Surrogate’s Court.  In this case, one must first file a petition with the Surrogate’s Court asking for permission to inventory the contents of the safe deposit box, usually under the supervision of a bank officer.  If the Last Will and Testament is found, it must be delivered to the Court by the bank.  Only then can the probate or administration be commenced.

Clearly, safe deposit boxes can become a hassle after the death of an owner.  In fact, the use of safe deposit boxes is becoming a thing of the past.  A better practice is to store your valuables at home in a safe or lock box.  For those who continue to use a safe deposit box, we do not recommend keeping your Last Will and Testament in that box.

Under New York State law, a spouse is considered a legally responsible relative which means that you are financially responsible for the support and care of your institutionalized spouse.  Absent any planning, you will likely be required to privately pay for the cost of the nursing home which could exceed $15,000 per month.  To minimize this financial catastrophe, one should consider Medicaid eligibility using the planning technique commonly referred to as “spousal refusal”. Read more

Essential Tips For Solo-Agers During Unprecedented Times

Are you a solo ager, or in some circles, an “elder orphan”?  A solo ager is typically defined as a single, childless baby-boomer.  Yet, a boomer may have children, but with whom there is no relationship, or in many cases, children who are simply pre-occupied with their own affairs.  While it is likely that you are unfamiliar with these artful terms, in fact, you may already be a solo ager and there is an increasing number of boomers who likely will become solo agers as well.  Odds are that everyone, whether having a partner or not, may become a solo-ager at some point.

Read more

Whether you are grieving the death of a close loved one, or have a deep sense of loss from your daily routines being interrupted, Dr. Bob will show you how to regain your equanimity; by beginning to dissolve your grief.

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