An Introduction and Overview to Estate Planning and Divorce
During the dissolution of a marriage, estate planning may be the last thing a person wants to address. However, it can be one of the most important steps in the process. Divorce can be complex and emotionally challenging enough and failing to adequately address the possibility of death, serious illness or disability throughout the process may leave folks at a serious disadvantage.
In Florida, estate planning during the course of a divorce proceeding requires the parties to consider many factors such as statutory provisions that control the allocation of assets, spousal rights, and the general financial well-being of the parties.
This article provides a cursory look into some of the more important factors of estate planning while going through a divorce proceeding in Florida.
Automatic Revocation of Certain Provisions of a Will
In Florida, certain provisions of a person’s Last Will and Testament may automatically be revoked upon the dissolution of a marriage. Florida statute 732.507(2) states that “Any provision of a will that affects the testator’s spouse is void upon dissolution of the marriage of the testator and the spouse…”.
This applies regardless of whether the marriage occurred prior to or after the Last Will and Testament was prepared and executed. However, it should be noted that these terms of such a Will remain enforceable during the dissolution of marriage proceedings and the statute applies only after a valid court order is entered dissolving the union.
This law ensures that non-martial property is left in accordance with the testator’s wishes post-marriage. Therefore, it is imperative that an estate plan is promptly revised to avoid any unintended consequences during the course of a divorce proceeding. Consultation with the marital attorney handling the divorce is important to ensure that the marital assets are not being affected by any changes made to the estate plan.
Elective Share and Pretermitted Spouse Laws in Florida
In Florida, a surviving spouse has the right to renounce the predeceasing spouse’s Last Will and Testament if they are dissatisfied with the terms and, instead, claim 30% of the deceased spouse’s estate.
This 30%, if elected, is called the Elective Share and is governed by Florida Statute section 732.201. It comprises of both probate and non-probate assets. Again, while this election remains during the course of the divorce proceedings, it is lost upon dissolution of the marriage.
Florida law also addresses the concept of a pretermitted spouse in section 732.301 which is one who is unintentionally left out of a decedent’s Last Will and Testament. Essentially, if a person marries after drafting their Will, a surviving spouse will receive a share in the estate of the decedent equal to the value of the estate that the spouse would receive had the decedent died intestate.
This rule applies in Florida unless the right is specifically waived in a pre- or post-nuptial agreement, the spouse is somehow provided for in the Will, or it can be shown that the spouse was specifically omitted from the Will.
In the context of divorce, if the to-be ex-spouse is omitted from the Will during the marriage, they may still have a claim if the decedent passes away prior to the formal dissolution of the marriage.
For this reason, it is important to work with both the marital law and estate planning attorneys to revise one’s estate plan during the course of a divorce proceeding.
In addition to the preparation of documents such as a Last Will and Testament or a Living Trust, a large component of estate planning involves the naming of beneficiary designations on financial assets such as life insurance policies, investment accounts, retirement accounts and other financial assets.
It is imperative that the named beneficiaries of such assets are updated during the course of a divorce proceeding to avoid those assets being transferred to an ex-spouse if the owner dies before the conclusion of the divorce proceeding.
Like with any other asset, it is important that changes are made to non-marital assets to avoid negative consequences with the divorce proceeding. Section 732.703 of the Florida Statutes reinforces the importance of reviewing and making the necessary changes to beneficiary designations after a divorce as well.
In Florida, homestead property carries several protections for spouses that can affected by a divorce proceeding. Section 732.7025 of the Florida Statutes governs the distribution of homestead property upon the passing of the owner.
According to Florida laws, homestead property cannot be devised in a Last Will and Testament if the decedent is survived by a spouse or a minor child. A surviving spouse holds a life estate interest in the property even if they are not an owner on title.
As a result of this law, folks who are going through a divorce proceeding need to discuss their options with their legal advisors to ensure they are in compliance with Florida laws.
Advanced Directives, Minor Children & Guardianship
Advanced Directives such as medical healthcare surrogates, healthcare powers of attorney and financial powers of attorney must all be updated to reflect the desired fiduciaries of the parties going through a divorce. Rarely would divorcing parties seek to have important medical and financial decisions be made by their to-be ex-spouses.
With respect to minor children of parents who are parties to a divorce, it is imperative to ensure that medical surrogates and guardians are appointed in the event of the death of both parents. These designations should be comprehensively discussed by the divorcing parties and then clearly stated in the estate planning document to avoid any potential disputes and to make sure the well-being of the children remains paramount.
Estate Planning and Divorce Conclusions
Estate planning on its own is an important topic that needs to be thoroughly thought through before being implemented. However, the added complication of a divorce proceeding makes these decisions even more significant.
Parties must navigate the intricacies of both estate planning and marital laws in Florida to ensure they comply with the various rules and fully consider their options. This is particularly the case with matters such as homestead property and minor children.
Given the nature of these decisions, parties engaged in a dissolution of marriage or divorce in Florida should seek the guidance of an estate planning attorney to work together with their marital and family law professionals to ensure their assets are protected, their loved ones are provided for, and they are in compliance with Florida laws. To learn more about how we may be able to assist you, contact us here.
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