Out-of-State Property and Connecticut Probate
A Connecticut resident who owns real property in another state will need probate in both Connecticut and the state where the property is located. This second proceeding, called ancillary probate, adds cost, complexity, and time to estate administration.
The Situs Rule
The legal principle is straightforward. Real property is governed by the law of the state where it sits (the “situs”). Personal property is governed by the law of the decedent’s domicile state.
If a Greenwich, Connecticut resident owns a vacation home in Vermont and an investment account at a New York brokerage, the estate administration works like this:
- The primary probate proceeding opens in Connecticut, where the decedent was domiciled.
- The Vermont vacation home requires a separate ancillary probate proceeding in Vermont, because Vermont controls what happens with real property within its borders.
- The New York brokerage account is intangible personal property governed by Connecticut law (the domicile), so it is administered through the Connecticut probate estate. No New York proceeding is needed for that account.
Tangible personal property located in another state (artwork stored in a New York gallery, a car garaged in Massachusetts) can raise situs questions, but in practice these items are usually administered through the domicile proceeding.
Ancillary Probate
Ancillary probate is a proceeding in a state where the decedent was not domiciled but owned real property. The ancillary state’s court appoints a local fiduciary (often the same person serving as executor in the domicile state) to handle the property in that jurisdiction.
The process varies by state but generally involves:
- Filing a certified copy of the domicile state’s probate decree and will (if any) with the appropriate court in the ancillary state
- Petitioning for ancillary letters of administration
- Complying with that state’s probate requirements for real property (inventory, creditor notice, tax clearance)
- Transferring or selling the property according to the will or intestacy law
- Accounting to the ancillary court and closing the ancillary proceeding
Each step generates its own court fees, attorney fees, and administrative burden. The ancillary state may also impose its own estate or inheritance tax on the property within its borders.
The New York-Connecticut Corridor
The Fairfield County-Westchester County border is one of the busiest cross-state corridors in the country. Connecticut residents owning New York property (and vice versa) is extremely common.
Connecticut decedent with New York real property. The primary estate opens in the Connecticut probate court. An ancillary proceeding is needed in the New York Surrogate’s Court for the county where the property is located. New York requires ancillary letters to be issued before real property can be sold or transferred. New York also imposes its own estate tax on the value of New York situs property, calculated using a formula that allocates the decedent’s total estate value between New York and non-New York assets.
New York decedent with Connecticut real property. The primary estate opens in the New York Surrogate’s Court. CGS 45a-287 and 45a-288 govern ancillary probate in Connecticut for nonresident decedents. The executor files the New York will (already proved in New York) with the Connecticut probate court, which can admit it without re-proving it. The Connecticut proceeding handles the Connecticut real property.
One wrinkle: Connecticut and New York have different will execution requirements. Connecticut requires two witnesses (CGS 45a-251). New York also requires two witnesses but has additional formalities. A will that is valid in the state where it was executed is generally accepted for ancillary probate in the other state, but defects in execution can create problems.
Tax Implications of Property in Multiple States
Owning property in multiple states can trigger tax obligations in each. Both Connecticut and New York impose estate taxes, and both states tax the full worldwide estate of their residents but allow credits or adjustments for property taxed by the other state.
For a Connecticut resident with New York real property:
- Connecticut taxes the entire estate but may allow a credit for estate taxes paid to New York on New York property.
- New York taxes the portion of the estate attributable to New York situs property. New York’s estate tax has a “cliff” provision: if the taxable estate exceeds 105% of the exemption, the entire New York estate is taxed with no exemption at all.
Careful planning around these dual-tax situations can save substantial money. An estate planning attorney familiar with both states’ tax regimes should review the numbers before major real property purchases across state lines.
Strategies to Avoid Ancillary Probate
Several planning tools eliminate or reduce the need for ancillary probate.
Revocable living trust. Transferring out-of-state real property into a revocable trust during life removes it from the probate estate entirely. The trust owns the property, and when the grantor dies, the successor trustee manages and distributes it without any court proceeding. This is the most common and reliable strategy.
Joint ownership with right of survivorship. If spouses own the out-of-state property as joint tenants with right of survivorship (or as tenants by the entirety where available), the property passes to the survivor automatically at the first death. No probate is needed. The limitation: this only works for the first death. At the survivor’s death, the property is back in the probate estate unless other planning is done.
Transfer-on-death deeds. Some states allow real property owners to execute a TOD deed naming a beneficiary who inherits the property at death without probate. Connecticut does not currently authorize TOD deeds for real property, but some other states do. If you own property in a state that permits them (Colorado, Ohio, and roughly 30 others), a TOD deed can eliminate ancillary probate for that property.
LLCs and other entities. Holding out-of-state real property in a limited liability company converts the asset from real property (subject to situs rules) to an interest in a business entity (personal property governed by domicile). The LLC interest passes through the domicile probate proceeding. This approach has tax and liability implications that require careful structuring with an attorney and accountant.
Which State’s Will Execution Rules Apply?
For a will to be admitted to ancillary probate, it must be valid under the execution requirements of the state where it was originally proved, or the state where the property is located, or the state where the will was executed. Most states, including Connecticut and New York, accept a will that was validly executed under the law of any of these jurisdictions.
The safest practice for people with property in multiple states: make sure your will satisfies the execution requirements of every state where you own real property. Since both Connecticut and New York require two witnesses and a signature, a will that meets both sets of requirements is not difficult to achieve. But self-proved affidavits, notarization requirements, and other formalities differ, and attention to these details during estate planning prevents headaches later.
Planning Ahead
If you own real property in more than one state, the time to address ancillary probate is during your estate planning, not after death. A Connecticut estate planning attorney who regularly handles cross-border matters can evaluate your specific properties and recommend the most efficient structure. The cost of planning is almost always less than the cost of ancillary proceedings in multiple states.
For more on using revocable trusts to avoid ancillary probate, see revocable living trusts in Connecticut. For the full cross-border planning picture, see NY-CT cross-border estate planning.