The death of a spouse is one of the most difficult and trying times in a person’s life. Often the surviving spouse is financially reliant upon the decedent and they require a share of the estate in order to have a good quality of life in the future. In the past in Florida, it was possible for a surviving spouse to be excluded from receiving their portion of the decedent’s estate, including the home they had shared together. Known as dower and courtesy, this often left surviving spouses with no share of the estate or a minimal amount that was not considered fair.
Beginning in 1975, this old process was abolished and surviving spouses were given the right to an elective share of the decedent’s estate. While this was a major step, it only applied to assets of the estate that passed through the probate process, which allowed decedents to exclude spouses by not subjecting their estate to probate. This was rectified in 1999 when Florida’s elective share laws were revised and expanded in order to ensure that the surviving spouse would not be left out in the cold with nothing.
What Assets Are Included?
In Florida, elective share is specified as an amount equal to 30% of the elective estate. This is defined under Florida Statute §732.2035, which details the property considered to be part of the elective estate. This includes the following:
- Any property subject to estate administration regardless of its location as long as it is in any state of the United States or the District of Columbia
- Any retirement plans, pay on death accounts, pensions, joint bank accounts, revocable trusts and totten trusts the decedent may have had
- Property that is held in joint tenancy and tenancy by the entireties – however this is limited to the decedent’s interest in the property
- Certain types of irrevocable transfers, which include transfers that have a retained right to income, principal or to discretionary principal distributions
- Any life insurance policies that are made payable to someone other than the surviving spouse, with includible value limited to the decedents in net cash surrender value at the time just before their death
- Any transfers made within one year to the date of the decedent’s passing
- Any irrevocable transfers that were made to an elective share trust
- Any property that is intended to pass directly to the surviving spouse
Elective Share in Practice
It is difficult for many to conceptualize how this works in a real world scenario, due to the often complex nature of estate administration after a decedent passes away. In order to make this easier to understand, below is an example of how elective share plays out in a real world scenario involving a surviving spouse and children heirs to the estate.
In this example the decedent’s estate has a gross value of $1.5 million. This is divided into a $300,000 home which is jointly owned with the surviving wife, six $125,000 Certificate of Deposit accounts that are setup to be payable upon death to their children and $450,000 in stocks. Because the home is jointly owned, its value is evenly split and the wife will receive $150,000 from the decedent.
However under Florida’s elective share laws the wife is entitled to 30% of the entire $1,500,000 estate, which comes out to $450,000. Since she will be receiving $150,000 from the house, she will be entitled to an additional $300,000 from the decedent’s assets, which means the beneficiaries are required to contribute any funds they received in order to satisfy the wifes elective share. Under Florida Statute §732.2145(2), the estates personal representative is required to enforce contributions from any recipients of the elective estate after a Florida probate court has ordered contribution.
Can Elective Share be Waived?
There are certain situations where elective share can be blocked or waived under Florida law. The first of these is when there is a valid prenuptial agreement or another valid written agreement signed and executed before or after a marriage. In this situation, the agreement will block the elective share from being applied and the surviving spouse will not be entitled to a 30% portion of the estate through this process.
Another situation in which elective share can be waived is when the surviving spouse does not elect it within the set time period set forth in Florida’s elective share guidelines. According to Florida Statute §732.2135, the time period for elective share is six months from the date of the decedent’s death, after which the surviving spouse’s right to elective share is waived and they are no longer entitled to a portion of the estate.