Articles by  Alice Reiter Feld

SPOUSES' ELECTIVE SHARE RIGHTS UPDATED IN FLORIDA STATUTES

ONE OF THE major changes enacted by the Florida Legislature that can significantly effect seniors and their families was a complete overhaul of Florida's elective share statute, the automatic right of a surviving spouse to share 30 percent in the estate of a deceased spouse (Florida Statutes Section 732.201 et al.).

As a Florida attorney originally from New York, I have successfully resisted the urge to say that everything from "home" was better than it is "down here." And, after 18 years, I have learned to respect my new home, its laws and customs, and celebrate the differences. That is, except for the elective share statue.

I have been an outspoken critic of Florida's archaic elective share law and frequently compared it to New York's, which was enacted back in 1966. So I was delighted to see the legislative changes and to see that Florida has finally caught up with my home state 33 years later.

Under the old elective share statute, the surviving spouse could only "elect" or take a share of the assets of the loved one's estate that was subject to probate. Probate assets only include those assets in the decedent's name alone. Assets jointly held in trust for someone (other than the  spouse), payable on death, with a designated beneficiary or in a living trust, are not subject to probate.

The result is that, if a loved one died with all of his or her assets in one of these probate avoiding vehicles, leaving it to someone other than a spouse, she/he could effectively completely disinherit and unsuspecting spouse.

Contrast this with the same couple with the same assets who--instead of one dying--decide to divorce. In this case, the spouses would each likely be entitled to 50 percent of the marital assets, no matter how the title was held.

Seeing this very unfair condition, the Florida legislature recently amended the elective share statue so that it applies to a much broader base of assets, far beyond the probate assets. For instance, payable on death accounts jointly owned property and assets in a revocable trust are part of the elective share.

The changes in the elective shares statute, effective for loved ones dying after October 1, 2002, are intended to make it more meaningful, not so easily circumvented, and more in line with how we treat couples who are divorcing.

For the second marriage, however, the results of the new law changes can be significant, and seniors and their families must be extremely careful about how this new law will affect them. Until the law change, a senior couple who married later in life would, in an effort to avoid doing a prenuptial agreement, do a living trust and fund it with all their assets.

While the trust certainly could not accomplish everything that a prenuptial agreement could, there was no arguing that it went a long way toward protecting the assets to an elective share claim by a surviving spouse.

No longer can a couple who marry in later years handle their affairs this way. It is now essential that each couple who marries and does not want a spouse to share in their estate (beyond what they choose to provide), execute a prenuptial agreement (or, if, they are already married, a postnuptial agreement). The unsuspecting couple, which does not address this issue, could leave their surviving family with unimaginable problems and crises.

The new statue provides for certain kinds of trusts that will satisfy the elective share statute and still provide for the ultimate beneficiaries. In this case, the corpus of the trust is protected for ultimate beneficiaries, while the spouse can enjoy the income for her/his life. Your estate-planning attorney can advise you on the trusts available, as well as how the new law effects you.

Printed August 5 - August 11, 1999,  Broward Jewish Journal