Wool Landon

Blog

A spouse has a special place as your heir-at-law

Wool Landon

In the US, you cannot simply choose to disinherit your spouse. You can freely disinherit friends, children, grandchildren and other relatives, and charities. This includes persons or charities you may have once named as a beneficiary of your will or revocable trust. If you want to disinherit, as with all things “estate planning,” you should have advice and counsel from your trusts and estate lawyer.

Community property and separate property states have different approaches to preserving your spousal rights to inherit

In a community property state, the general rule is that property acquired during the marriage is deemed to belong to the “community.” There are 10 states that have community property applications for married couples: California, Washington, Arizona, Alaska, Idaho, Louisiana, Nevada, New Mexico, Texas, and the most recent Florida, which allows a married couple to create a community property trust. The laws are not identical, but in general, on death a spouse only controls a ½ interest in the community property. That means their will or trust can only give ½ their community property to someone other than a spouse. States that are not community property states have some form of forced ‘elective’ share creating a right in a surviving spouse to demand a share of the property of their deceased spouse. Many states have adopted a form of “augmented estate” where the law combines the separate property of both spouses to determine how much a surviving spouse is entitled to receive from a deceased spouse.

If you want to disinherit a spouse, you must execute a premarital (prenuptial) or postnuptial agreement

This is a contract between persons planning to marry or persons already married. In the majority of states, these agreements are enforceable if they are undertaken with certain formalities. They must be in writing and signed by both parties. Most important, the formalities for this written contract also include “arms-length” negotiations. To truly be “arms-length”, it is preferable that each person have a separate lawyer. Each person has to understand the nature of the document, their legal rights, the assets that each party owns, and the rights that they are agreeing to waive. Postnuptial Agreements are a special subset of such a contract, because it is a contract between people who are already married and whose rights to inherit are firmly established by state law. Many states do not have statutory law to govern a postnuptial agreement. Even if a postnuptial agreement is a very simple statement waiving rights under the law, if they are not undertaken with formalities, they are likely to be set aside at the hands of a competent lawyer for a surviving spouse.

How and when should I have a prenuptial or postnuptial agreement?

A prenuptial agreement entered into well ahead of marriage with all the formalities your state requires can be a very effective contract. Contact a lawyer months, even a year, ahead of your wedding. Expect your lawyer to explain that your fiancé needs their own separate lawyer to review the proposed writing and participate in negotiations. No one should sign a prenuptial agreement just before the wedding unless they have undertaken documented negotiations with advice and counsel from ones own separate attorney. A good prenuptial agreement is not signed under duress, and it includes an exhaustive sworn list of each persons assets and liabilities. Except for the timing, a good post-nuptial agreement entered into after marriage follows all the rules of a good prenuptial agreement: full disclosure, separate attorneys, no duress or coercion. Don’t threaten to divorce your spouse or make any other threat to get a spouse to sign the postnuptial agreement. Postnuptial agreements can be enforced, but don’t have the same legal certainty as a good prenuptial agreement. Don’t undertake one without working through all the facts and purposes with a skilled lawyer.