Call for a Consultation
(914) 290-4550 (888) 892-9072
Menu Contact

Legislative Update

The New York State legislature has voted to amend New York Law and change the rules governing payment of interest on a delayed distribution of a cash legacy from an Estate.

Under the prior law, interest was only payable on a cash legacy that was not paid within seven months of the appointment of a fiduciary, and only if a demand was made upon the fiduciary prior to commencing a proceeding in the Surrogate's Court to compel payment of that distribution. The prior statute fixed interest at 6% starting seven months from the time that Letters Testamentary, including Preliminary Letters Testamentary, are granted and permits the Court to award interest at the legal or judgment rate of 9% as set forth in the CPLR, if the delay in paying legacies was unreasonable.

Under the new law: 1) The interest rate will be pegged to the "Federal Funds" rate so as to ensure that the statutory rate is neither too high nor too low; 2) Unless otherwise provided for in the terms of the Will or Trust, such outright cash legacies are to be paid no less than seven months from the time Letters Testamentary (including Preliminary or Temporary Letters) are issued, with interest attaching automatically thereafter; and 3) Any actual interest paid will be deductible by the Estate, and considered income for the beneficiary.

Given this new change, when undertaking your Estate planning please consider if you would like to address this issue of interest regarding such cash bequest. Alternatively, if you are appointed as a fiduciary, be advised that the legislature has changed the law, and now requires that interest be paid on a delayed cash legacy.


No Comments

Leave a comment
Comment Information
Email Us For A Response

Office Location

Bashian P.C.
235 Main Street
White Plains, NY 10601

Toll Free: 888-892-9072
Phone: 914-290-4550
Fax: (914) 946-5111
White Plains Law Office Map

Satellite Office:
552 Lake Avenue
Greenwich, CT 06830

Toll Free: 888-892-9072
Map & Directions

Contact The Firm For An Initial Consultation

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy