In New Jersey, if your spouse dies, you have a legal right to take what is called an “elective share” from his estate.
The elective share is the minimal amount that a spouse is entitled to by law. It’s meant to prevent someone from disinheriting his or her spouse and leaving the spouse destitute. For example, the elective share would prevent a man in a second marriage from leaving everything to his children from a prior marriage, and leaving his second wife bereft.
The amount of the elective share is determined through a complicated formula, per N.J.S.A. 3B:8-1 et seq. Essentially, the elective share is equal to one-third of the deceased spouse’s estate, plus certain property the decedent gave away while he was alive, minus the property the surviving spouse owns.
In short, the elective share is the minimum that one spouse can leave to the other when he or she dies. This is great for scorned spouses, but not as good for Medicaid beneficiaries.
To qualify for Medicaid, you generally must have less than $2,000 in assets. So if you are on Medicaid, and your spouse isn’t, and your spouse dies and leaves an elective share to you, then that property will disqualify you from Medicaid until it’s spent down (or otherwise disposed). If you’re receiving long term care Medicaid, that property will likely be lost to long term care costs.
However that’s a lot better than the alternative. Most people in first marriages leave all of their property to their spouses, not just the elective share. That means all the property will be lost to long term care costs. Instead, if your spouse is on Medicaid and you aren’t, you can create a new estate plan that leaves the minimum elective share to your spouse, and the rest of your property to your children, siblings or other heirs.
For information about your specific circumstances, call or email FriedmanLaw today.