Probate vs. Non-Probate Assets in New York and When an Estate Qualifies as a Small Estate

By Albert Goodwin, Esq., Law Offices of Albert Goodwin

New York's Estates, Powers and Trusts Law defines an estate as the interest a person has in property, or the total property a person owns (EPTL 1-2.6). After a death, the practical question is narrower: which of the decedent's assets must pass through Surrogate's Court, and is the court-supervised portion small enough for New York's simplified procedure?

This page answers both questions under New York law. It covers how to sort probate from non-probate assets, the $50,000 small estate test under SCPA Article 13, the family exemptions that reduce the countable estate, and four worked examples.

Probate assets and non-probate assets

A probate asset is property the decedent owned in their own name, with no surviving co-owner and no living beneficiary designated to receive it. A will governs these assets. Without a will, they pass to the distributees set out in EPTL 4-1.1. In both cases, someone usually needs authority from the Surrogate's Court to collect and transfer them.

A non-probate asset passes outside the will by contract, title or statute. The new owner collects it directly, usually with a death certificate and a claim form.

Assets that are usually probate assets

• Sole-name real property: a house, condominium or land titled only to the decedent, or the decedent's share of property held as tenants in common.
• Co-op apartments in the decedent's sole name: co-op shares and the proprietary lease are personal property in New York, not real property. This matters for the small estate test, discussed below.
• Individual accounts: bank and brokerage accounts in the decedent's name alone with no payable-on-death or transfer-on-death designation.
• Vehicles and tangible items: cars, boats, jewelry, art, collectibles, furniture and clothing.
• Business interests: shares in a closely held company, LLC interests and sole proprietorship assets, subject to any buy-sell agreement.
• Money owed to the decedent: final wages, refunds, royalties and debts other people owed the decedent.
• The decedent's own legal claims: for example, damages for the decedent's conscious pain and suffering before death, which survive under EPTL 11-3.2.

Assets that are usually non-probate assets

• Tenancy by the entirety: under EPTL 6-2.2(b), a deed to two spouses creates a tenancy by the entirety unless the deed says otherwise. The surviving spouse owns the property outright at the first death.
• Joint tenancy with right of survivorship: real property deeded to non-spouses passes to the survivor only if the deed expressly creates a joint tenancy. A deed to two or more people that says nothing more creates a tenancy in common under EPTL 6-2.2(a), and the decedent's share becomes a probate asset.
• Joint bank accounts: an account opened in the form described in Banking Law 675 is presumed to belong to the survivor. A "convenience" account opened under Banking Law 678 is not a survivorship account, and the funds belong to the estate.
• Payable-on-death and Totten trust accounts: bank accounts held "in trust for" or payable on death to a named person (EPTL Article 7, Part 5).
• Transfer-on-death securities: brokerage accounts registered TOD under EPTL Article 13, Part 4.
• Transfer-on-death deeds: New York began recognizing these for real property in July 2024 (EPTL 2-1.17). A properly executed and recorded TOD deed passes the property to the named beneficiary without probate.
• Beneficiary-designated contracts: life insurance, annuities, IRAs, 401(k) and 403(b) plans, and pensions with a living named beneficiary.
• Trust property: assets titled to a revocable or irrevocable living trust during the decedent's lifetime. See which assets can and cannot go into a revocable trust.

When a non-probate asset becomes a probate asset

Beneficiary designations fail more often than people expect. Common situations include these:

• The only named beneficiary died before the account owner and no contingent beneficiary was named.
• No beneficiary was ever named, or the custodian cannot locate the designation.
• The estate itself is named as beneficiary.
• The joint owner on a survivorship account died first, leaving the account in the decedent's sole name.

In these cases the plan or policy terms decide where the money goes. Many life insurance policies and IRA agreements default to the owner's estate. Some employer retirement plans default to a surviving spouse first. If the default is the estate, the asset becomes a probate asset and counts toward the small estate limit. For bank accounts in this situation, see what happens to a New York bank account with no beneficiary.

Wrongful death proceeds are a special category

Only a court-appointed personal representative can bring a wrongful death action in New York (EPTL 5-4.1). The recovery is not a general estate asset. Under EPTL 5-4.4, damages for pecuniary loss belong to the decedent's distributees and are divided in proportion to each person's loss, as the court determines. The will does not control them and the decedent's general creditors cannot reach them, although the statute allows reasonable funeral and medical expenses to be paid from the recovery. A survival claim for the decedent's own pain and suffering is different: that recovery is an estate asset.

The practical result is that a wrongful death case almost always requires someone to obtain letters of administration, or limited letters, from the Surrogate's Court before suit is filed or settled.

The New York small estate test under SCPA 1301

New York's simplified procedure is called voluntary administration and is governed by SCPA Article 13. Under SCPA 1301, an estate qualifies when the decedent's personal property is $50,000 or less, not counting property set off to the family under EPTL 5-3.1.

Three points about this test cause the most confusion:

• Only personal property counts: real property is not part of the $50,000 calculation. Owning a house does not by itself make an estate "not small."
• Only probate assets count: life insurance with a living beneficiary, survivorship accounts and trust assets are excluded, whatever their size.
• Exempt family property is subtracted first: items set off under EPTL 5-3.1 do not count toward the limit.

What a voluntary administrator can and cannot do

A voluntary administrator can collect the decedent's personal property, pay funeral expenses and debts in the order of priority set by law, and distribute what remains to the beneficiaries or distributees. The court issues a certificate rather than full letters, and no bond is required.

The role has limits. A voluntary administrator generally cannot sell or transfer the decedent's real property and is not the right fiduciary to pursue a wrongful death claim or other significant litigation. Those matters usually require letters testamentary (if there is a will) or letters of administration (if there is not). An estate can therefore be "small" under SCPA 1301 and still need a full proceeding to deal with a house or a lawsuit.

Who may serve

If there is a will, the named executor may serve. If there is no will, SCPA 1303 sets the order of priority, beginning with the surviving spouse, then adult children, then other relatives in the order the statute lists. The voluntary administrator must be an adult and otherwise eligible to act as a fiduciary.

Where and how to file

File in the Surrogate's Court of the county where the decedent lived at death. In New York City that means:

• Manhattan: New York County Surrogate's Court
• Brooklyn: Kings County Surrogate's Court
• Queens: Queens County Surrogate's Court
• The Bronx: Bronx County Surrogate's Court
• Staten Island: Richmond County Surrogate's Court

The filing is a small estate affidavit, available through the New York State Unified Court System's Surrogate's Court forms and the court's guided CourtHelp materials. You will usually need a certified death certificate, the original will if one exists, a list of the decedent's personal property and its value, and the names and addresses of the distributees or beneficiaries. The filing fee is set by SCPA 2402 and depends on the size of the estate. Confirm the current amount with the clerk before filing.

Voluntary administration is typically faster than a full proceeding because there is no formal citation process and no bond. Timing still varies by county and by how complete the paperwork is. Clerks often return affidavits for missing distributee information, an unclear asset list or a will that has not been located. For comparison, see this sample NYC probate timeline for a full proceeding.

When the work is finished, the voluntary administrator must account to the court for what was collected and how it was paid out.

Family exemptions under EPTL 5-3.1

Before the small estate calculation, and before creditors or beneficiaries are paid, EPTL 5-3.1 sets off certain property for the surviving spouse or, if there is no spouse, the decedent's children under 21. The statute lists categories with dollar caps, including:

• Household items: furniture, appliances, electronic devices, clothing and similar items, up to $20,000.
• Family books and pictures: the family bible, family pictures, books and computer software, up to $2,500.
• Animals and farm equipment: domestic and farm animals with their food, and farm machinery, up to $20,000.
• One motor vehicle: up to $25,000.
• Money or other personal property: up to $25,000, subject to reduction in some estates for funeral expenses.

These amounts change when the legislature amends the statute, so check the current text. The exemptions can make the difference between a small estate and a full proceeding. A decedent with $60,000 in a sole-name account and a surviving spouse may fall under the $50,000 limit once the $25,000 cash exemption is set off.

SCPA 1310: collecting small sums without any court filing

SCPA 1310 is a separate and narrower tool. When no executor, administrator or voluntary administrator has been appointed, a bank, employer or other party holding money owed to the decedent may pay it directly to the surviving spouse or, if there is none, to certain other relatives in the order the statute lists. The statute caps the amount. As of this writing the cap is $30,000, but confirm the current figure in the statute text before relying on it.

The key word in the statute is "may." Payment under SCPA 1310 is permitted, not required. The person receiving the money also takes on a duty to use it properly, beginning with funeral expenses.

Why banks push back, and what practitioners do

Many banks decline SCPA 1310 affidavits or impose their own limits because the statute does not require them to pay. Common responses include asking for letters, asking for a certificate of voluntary administration, or applying an internal threshold below the statutory cap. Practical steps that often resolve the problem:

• Ask for the bank's estate services or deceased-customer department rather than a branch, and request its written requirements.
• Provide a certified death certificate, the affidavit and identification together in one submission.
• Where family relationships are disputed or unclear, an affidavit of heirship can support the claim.
• If the bank still refuses, file for voluntary administration. A court certificate is usually accepted where an informal affidavit is not.

Four worked examples

Example 1: Surviving spouse with mostly joint assets

A husband dies without a will. He leaves a life insurance policy naming the couple's children, a house deeded to both spouses, $20,000 in a joint survivorship account with his wife, and $30,000 in an account in his name alone.

• The insurance goes to the children under the policy. Non-probate.
• The house was held as tenants by the entirety. It belongs to the wife at his death. Non-probate.
• The joint account passes to the wife as survivor. Non-probate.
• The $30,000 sole-name account is the only probate asset.

The estate is small. The wife can ask the bank to pay her under SCPA 1310. If the bank declines, she can file a small estate affidavit in the Surrogate's Court and collect as voluntary administrator. Because there is no will, the account passes under EPTL 4-1.1. With a spouse and children, the spouse takes the first $50,000 plus half of the balance, so here she receives the full $30,000 after any funeral expenses and debts are paid.

Example 2: Sole-name co-op in Manhattan

A widow dies owning shares in a Manhattan co-op worth $700,000 in her name alone, plus a $10,000 checking account. Because co-op shares are personal property in New York, her personal property is about $710,000. The estate is not small. Her executor needs letters testamentary, or if she left no will, a relative needs letters of administration, before the co-op board will approve a transfer or sale. If she had owned a condominium instead, the condo would be real property and would not count toward the $50,000 test, though a full proceeding would still be needed to sell it.

Example 3: Small personal estate, a Queens house and a pending lawsuit

An unmarried man dies without a will. He leaves $35,000 in a sole-name account, a house in Queens in his own name, and a pending personal injury case from a car accident months before his death.

His personal property is under $50,000, so the estate meets the SCPA 1301 test. A voluntary administrator, though, generally cannot sell the house or continue the lawsuit. Title to the house passed to his distributees at death, but selling it with clear title usually requires an administrator with full letters. Continuing the injury case also requires a fiduciary with authority to sue. In practice, the family will usually skip voluntary administration and file one administration proceeding that covers everything. See appointing an administrator when there is no will.

Example 4: An IRA whose beneficiary died first

A woman dies with $15,000 in a sole-name account and an $80,000 IRA naming her late mother as the only beneficiary, with no contingent beneficiary. Under the custodian's agreement, the IRA defaults to her estate. Her personal property is now $95,000. The estate is not small, and a full probate or administration proceeding is needed. The estate as beneficiary may also face less favorable income tax payout rules than a named individual would have, which is a reason to review designations during life.

When the estate is not small

If the probate estate exceeds the small estate limit, or a house or lawsuit needs a fiduciary with full authority, the next step depends on whether there is a will:

• With a will: the executor petitions for probate and receives letters testamentary. See letters testamentary in New York.
• Without a will: a distributee petitions for administration and receives letters of administration. See estate administration in New York and attorneys for letters of administration.

If you are planning ahead and want to keep assets out of Surrogate's Court, see how to avoid probate in New York. For tax questions about joint accounts, see whether joint bank accounts are subject to inheritance tax.

Talk to a New York estate lawyer

Sorting assets correctly at the start decides which court filing you need, or whether you need one at all. The Law Offices of Albert Goodwin handles voluntary administration, probate and administration proceedings in Surrogate's Courts across New York City, with offices in Manhattan, Brooklyn and Queens. Call 212-233-1233 or email [email protected].

This page provides general information about New York law and is not legal advice. Statutory amounts and court procedures change. Reading it does not create an attorney-client relationship. Consult a lawyer about your specific situation.

Sources

• EPTL 1-2.6: definition of estate
• EPTL 4-1.1: distribution when there is no will
• EPTL 5-3.1: family exemptions
• EPTL 5-4.1 and EPTL 5-4.4: wrongful death actions and distribution
• EPTL 6-2.2: tenancy by the entirety, joint tenancy and tenancy in common
• SCPA Article 13, including SCPA 1301, SCPA 1303 and SCPA 1310: small estates
• Banking Law 675: joint accounts
• NY Surrogate's Court forms