S T A T E O F N E W Y O R K
________________________________________________________________________
5519
2011-2012 Regular Sessions
I N S E N A T E
May 27, 2011
___________
Introduced by Sen. BONACIC -- (at request of the Office of Court Admin-
istration) -- 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
certain formula clauses to be construed to refer to the federal estate
and generation-skipping transfer tax laws applicable to estates of
decedents dying after December 31, 2009 and before January 1, 2011
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 2-1.13 of the estates, powers and trusts law, as
added by chapter 349 of the laws of 2010, is amended to read as follows:
S 2-1.13 Certain formula clauses to be construed to refer to the federal
estate and generation-skipping transfer tax laws applicable
to estates of decedents dying after December thirty-first,
two thousand nine and before January first, two thousand
eleven
(a)(1) If by reason of the death of a decedent property passes or is
acquired under a beneficiary designation, [in the case of] a will or
trust of a decedent who dies after December thirty-first, two thousand
nine and before January first, two thousand eleven, that contains a
bequest or other disposition based upon the amount of property that can
be sheltered from federal estate tax by referring to the "unified cred-
it", "estate tax exemption", "applicable exclusion amount", "applicable
exemption amount", "applicable credit amount", "marital deduction",
"maximum marital deduction", "unlimited marital deduction", "charitable
deduction", "maximum charitable deduction" or similar words or phrases
relating to the federal estate tax, or that measures a share of an
estate or trust based on the amount that can pass free of federal estate
taxes, or that is otherwise based on a similar provision of federal
estate tax THEN SUCH BENEFICIARY DESIGNATION, WILL OR TRUST shall be
deemed to refer to the federal estate tax law as applied with respect to
decedents dying [on December thirty-first, two thousand nine] IN TWO
THOUSAND TEN, REGARDLESS OF WHETHER AN ELECTION IS MADE NOT TO HAVE THE
FEDERAL ESTATE TAX APPLY TO A PARTICULAR ESTATE.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11472-02-1
S. 5519 2
(2) If by reason of the death of a decedent property passes or is
acquired under a beneficiary designation, [in the case of] a will or
trust of a decedent who dies after December thirty-first, two thousand
nine and before January first, two thousand eleven, that contains a
bequest or other disposition based upon the amount of property that can
be sheltered from federal generation-skipping transfer tax by referring
to the "generation-skipping transfer tax exemption", "GST exemption",
"generation-skipping transfer tax", "GST tax" or similar words or phras-
es that measures a share of an estate or trust based on the amount that
can pass free of federal generation-skipping transfer taxes, or that is
otherwise based on a similar provision of federal generation-skipping
transfer tax law[; or if such bequest would have passed as a "direct
skip" to a "natural person" within the meaning of such terms under chap-
ter 13 of the Internal Revenue Code of 1986 if the decedent had died on
December thirty-first, two thousand nine], then such BENEFICIARY DESIG-
NATION, will or trust shall be deemed to refer to the federal genera-
tion-skipping transfer tax law in effect [on December thirty-first, two
thousand nine] IN TWO THOUSAND TEN, REGARDLESS OF WHETHER AN ELECTION IS
MADE NOT TO HAVE THE FEDERAL ESTATE TAX APPLY TO A PARTICULAR ESTATE.
(3) This paragraph shall not apply to a BENEFICIARY DESIGNATION, will
or trust that[:
(A) is executed or amended after December thirty-first, two thousand
nine; or
(B) Manifests] MANIFESTS an intent that a contrary rule shall apply
[if the decedent dies on a date on which there is no then applicable
federal estate tax or generation-skipping transfer tax].
[(4) The reference to January first, two thousand eleven in this para-
graph shall, if a federal estate tax or generation-skipping transfer tax
becomes applicable before that date, be construed to refer instead to
the first date on which the federal estate tax or generation-skipping
transfer tax becomes applicable.]
(b) The executor, trustee or other interested person under a BENEFICI-
ARY DESIGNATION, will or trust referred to in paragraph (a) of this
section may bring a proceeding to determine whether the [decedent
intended that the references described in such paragraph be construed
with respect to the law as it existed on the decedent's date of death,
without regard to the provisions of paragraph (a) of this section] BENE-
FICIARY DESIGNATION, WILL OR TRUST MANIFESTS A CONTRARY INTENTION WITHIN
THE MEANING OF SUBPARAGRAPH THREE OF PARAGRAPH (A) OF THIS SECTION. In
any such proceeding, extrinsic evidence may be admitted to establish the
decedent's intent. [Such proceeding]
(C) ANY PROCEEDING DESCRIBED IN PARAGRAPH (B) OF THIS SECTION must be
commenced [within twelve] BY THE DATE WHICH IS (1) TWENTY-FOUR months
following the DATE OF death of the DECEDENT, testator or grantor OR (2)
SIX MONTHS FOLLOWING THE DAY ON WHICH THE CHAPTER OF THE LAWS OF TWO
THOUSAND ELEVEN WHICH AMENDED THIS PARAGRAPH BECAME A LAW, WHICHEVER
DATE IS LATER, and not at any time thereafter. NOTWITHSTANDING THE
FOREGOING, THE TIME TO COMMENCE SUCH A PROCEEDING MAY BE EXTENDED, IN
THE DISCRETION OF THE COURT, ON A PETITION SHOWING REASONABLE CAUSE AND
ON NOTICE TO SUCH PERSONS AND IN SUCH MANNER AS THE COURT MAY DIRECT.
S 2. This act shall take effect immediately and shall be deemed to
have been in full force and effect on and after January 1, 2010, and the
provisions of this act shall apply to wills and trusts of decedents who
die after December 31, 2009 and before January 1, 2011.