Divorce and Estate Planning in Florida

During life’s challenging transitions like a divorce, estate planning is usually not a high priority for those involved.

However, nothing could be further from the truth.

In Florida, revising one’s estate plan while going through a dissolution of marriage or divorce is paramount to protecting one’s assets and avoiding unintended consequences.

This article investigates some of the important steps needed during and immediately after a divorce in Florida.

Why is Estate Planning Important During Divorce in Florida?

When a petition for dissolution of marriage (i.e. a divorce action) is filed in the state of Florida, almost all aspects of one’s legal and financial standing are subject to change.

Typically, estate planning documents such as Last Wills and Testaments, Trusts, Powers of Attorney, as well as Medical Healthcare Directives name spouses as either fiduciaries, beneficiaries or, most often, both. A divorce action usually indicates that a current spouse no longer is an intended beneficiary or fiduciary. Therefore, making amendments to one’s estate plan is crucial.

In Florida, certain statutes provide protection to those who file for divorce. For example, Florida Statute §732.507(2) provides that a Will in which a spouse is named as a beneficiary becomes void upon a divorce.

This revocation does not automatically apply to other documents, however, such as beneficiary designation etc. Conversely, powers of attorney in which a to-be ex-spouse is named agent are considered revoked at the time the petition for divorce is filed.

Important Steps for Estate Planning During a Divorce in Florida

1. Revoking or Updating a Last Will and Testament

Although Florida laws revoke any provision of a Last Will and Testament that devises assets to a former spouse at the finalization of a divorce, the document remains valid during the divorce proceedings unless the documents provides. Therefore, if a testator died while still married, but during a divorce, the surviving spouse will receive the devises awarded to them in the Will or revocable Trust unless the document’s terms contain a condition that no divorce proceeding be pending at the time of the testator’s death. As such, it is important to review and amend these documents accordingly, even if on a temporary basis, if one wishes to avoid a to-be ex-spouse to remain as a beneficiary or fiduciary.

Initial Steps to Consider:

• Revoke the current Last Will and Testament and draft a new document that reflects post-separation intentions.
• Redesignate beneficiaries for specific assets.
• Appoint a new personal representative/executor if the to-be ex-spouse is currently named.

It should be noted, however, that a surviving spouse’s right to claim an elective share of their deceased spouse’s estate ends if they divorce unless the divorce decree judgement states otherwise. It remains in effect during the course of the divorce proceedings. The elective share is a law that protects a surviving spouse from being disinherited by allowing such spouse to receive a minimum of 30% of their deceased spouse’s estate.

2. Durable Powers of Attorney

If a spouse executes a Durable Power of Attorney in which their spouse is the designated agent, then it will be automatically terminated upon the filing of the petition for dissolution of marriage (i.e. filing the divorce action).

This provides protection against a to-be ex-spouse from improperly using such powers to misappropriate the assets of the principal spouse. Regardless, it is still advisable to revoke any existing durable power of attorney that designates a to-be ex-spouse as agent.

3. Advanced Healthcare Directive – Surrogate Designation and/or Living Wills

In Florida, it is customary for a spouse to be named as a primary health care surrogate. This designation remains effective until they are revoked, terminated under the terms of the authorizing documents or upon entry of a final judgement of dissolution of marriage (i.e. the divorce decree) when it is automatically revoked.

Unless the document provides otherwise, merely filing a petition for divorce has no effect on a healthcare surrogate designation as is with the case with the durable power of attorney.

When updating these directives, it is important to ensure that the revised documents comply with Florida Statute §744.3201, which governs powers of attorney, and Florida Statute §765.202, which covers healthcare surrogates.

4. Beneficiary Designations

Beneficiary Designations are often overlooked and forgotten when updating an estate plan during a divorce. Examples of assets to which Beneficiary Designations apply are life insurance policies, retirement accounts and other pay-on-death bank accounts.

Florida law states that a spouse’s interest is voided automatically after the final judgement of dissolution of marriage or divorce decree is entered by the court if the designation was made prior to the divorce itself.

While there are some exceptions (i.e. ERISA plans), beneficiary designations on all financial accounts, life insurance policies and retirement accounts should be updated upon filing the petition of divorce.

5. Real Estate Assets

Real estate assets are usually the main assets subject to divorce proceedings. The ruling of the divorce case directly affects one’s estate planning options as it pertains to real estate assets, particularly if the property was regarded as the homestead property of the couple.

If property is awarded to an individual pursuant to the divorce decree, it is important to retitle the subject property in accordance with the court ruling.

This may be done via a Lady Bird Deed (i.e. Enhanced Life Estate Deed) so that future beneficiaries may inherit the property outside of probate while the rightful owner maintains control of the property during their lifetime.

Any real property owned as tenants by the entireties during a marriage automatically becomes tenants in common upon the entering of the final divorce decree.

6. Revocable Trusts

Similarly to Last Wills and Testaments, living Revocable Trusts should be amended to reflect post-divorce filing intentions.

As spouses are typically named as fiduciaries and beneficiaries, any amendment should align with post-divorce distribution intentions to avoid unnecessary litigation among family members and depletion of estate assets.

Keeping Your Estate Plan Up to Date

Every estate planning attorney preaches to their clients the importance of updating their plans during or after major life changes such as divorces.

Regularly reviewing and updating one’s estate plan is crucial to making sure the plan reflects the individual’s wishes, and it helps avoid unintended consequences during the dissolution of a marriage.

Conclusion on Divorce and Estate Planning in Florida

Estate planning through a divorce in Florida requires careful attention to detail, proactive updates, and compliance with the state’s laws.

For those finding themselves in the midst of or post-divorce in Florida, it is advisable to review your existing estate planning documents and start the process to making the necessary amendments.

To learn how we may be able to assist during this process, contact us here.