In your estate plan you have the opportunity to plan how you wish for your property to be distributed after you pass away. However, if you were married at the time of your passing, the Florida Constitution as well as Florida laws may limit your options in how you may distribute your homestead. In practice, your wishes and family dynamics after you pass away do not always agree. Careful planning may help.
A surviving spouse is entitled to certain rights in homestead property, absent a valid pre- or post-nuptial agreement. In many cases, a married couple holds title to homestead property as a tenancy by the entireties, that is, as husband and wife with rights of survivorship. Upon the death of the first spouse, the surviving spouse then owns the entire property. The second spouse to pass away can then distribute the homestead as he or she wishes. In the case of a second marriage, the surviving spouse could then leave the house to his or her own children, and leave out any step children. Although the couple may say, “That would never happen,” over the years if the step children do not maintain contact, or if the surviving spouse remarries, it could happen, and it often does happen.
Florida’s Constitution states that if you are married and have no minor children, you may only leave your homestead to your spouse at your passing. If instead you wish to leave your homestead to your children, you may not do so unless you both execute a valid pre- or post-nuptial agreement. If you do anything else, then your homestead will pass through probate and your surviving spouse will receive a life estate, with your children receiving the remainder interest. Alternatively, your surviving spouse may elect to receive a 50% interest as a tenant in common with your children owning the other 50%.
With second marriages, a spouse may wish to grant the surviving spouse to inherit a life estate in the homestead, that is, the right to continue to live in the homestead until he or she dies. The terms of this life estate should be spelled out in a nuptial agreement and in the will or trust. For example, the documents should state who will pay for insurance, taxes and maintenance. If the surviving spouse does not have sufficient assets to pay for these costs, then funds could be left in trust to cover these expenses.
The agreement could also specify whether the right to live in the homestead ends or continues if the surviving spouse remarries or cohabitates or if the surviving spouse wishes to no longer live in the homestead. The surviving spouse could have the option of selling the homestead and reinvesting the proceeds in a less expensive property. The agreement should specify what would happen to any excess funds.
In second marriages it is important for the couple to discuss how they wish for the homestead property to be handled after each of them passes away. It is also important to meet with attorneys who can draft estate planning documents and nuptial agreements consistent with their wishes.
This newsletter is for general information and education purposes only.
It is not offered as legal advice or legal opinion.
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