Asset Protection in New York: An Overview of the Homestead Exemption
Asset protection is an important part of the estate planning process for people and families in New York. Our state’s homestead exemption offers one useful tool for wealth preservation. At Poulos LoPiccolo PC, we help clients protect their assets. Here, our New York City estate planning lawyer provides a comprehensive guide to New York’s state-level homestead exemption.
What is a Homestead Exemption?
Broadly defined, a homestead exemption is a legal provision that protects the value of a person’s home from property taxes, creditor claims, and other certain issues. The exemption—the value of which varies by state and even county—allows a homeowner to shield a portion of the equity held in the primary residence from claims.
An Overview of the Homestead Exemption in New York State
Under New York law (N.Y. CPLR § 5206), all homeowners are eligible to claim a homestead exemption which protects some (or, potentially, all) of the equity in the primary residence against creditor claims. The value of the homestead exemption varies by county. All of the counties in the New York City region are eligible for the maximum exemption. The exemption is $150,000 in 2024. It applies to primary residences in the following counties:
- Kings;
- Queens;
- New York;
- Bronx;
- Richmond;
- Nassau;
- Suffolk;
- Rockland;
- Westchester; and
- Putnam.
Here is an example of how the New York homestead exemption operates. Imagine you own a home worth $500,000 in Queens. You have a $400,000 mortgage on your home. As the exemption is $150,000, all of your equity ($100,000) is protected against creditor claims.
Married Couples Can Double the Homestead Exemption in New York State
In New York State, married couples enjoy the benefit of potentially doubling their Homestead Exemption if both partners are listed as owners on the deed. In effect, it increases the amount of home value that is protected from creditors. For married homeowners in New York City, they can claim a $300,000 homestead exemption.
Homestead Exemption Provides Some Asset Protection (Often Insufficient)
While the homestead exemption offers a vital, fundamental level of asset protection, it is often insufficient alone to fully protect a homeowner’s assets in cases of severe financial distress. Remember, the exemption does not shield other personal assets. Further, the limits of the exemption may not cover the full value of your home/home equity. No matter your circumstances, our New York City estate planning lawyers can help you put the right strategy in place to protect your family home and your other assets.
Contact Our New York Asset Protection Estate Planning Attorney Today
At Poulos LoPiccolo PC, our New York City estate planning lawyer provides solutions-driven asset protection services. If you have any questions about the homestead exemption or asset protection more generally, we are here to help. Contact us today to arrange your confidential initial case review. Our firm provides estate planning services in New York City and beyond.
Source:
casetext.com/statute/consolidated-laws-of-new-york/chapter-civil-practice-law-and-rules/article-52-enforcement-of-money-judgments/section-5206-real-property-exempt-from-application-to-the-satisfaction-of-money-judgments#:~:text=CPLR%205206,-Download&text=Law%20Chapter%20432-,Section%205206%20%2D%20Real%20property%20exempt%20from%20application%20to%20the%20satisfaction,payment%20of%20taxes%20or%20assessments.
