Have You Checked Your Beneficiary Designations Since Your Divorce?

Effective July 1, 2012, a new Florida law takes affect concerning beneficiary designations on employee benefit plans.  Under current law, when a divorced individual dies if their Last Will & Testament designates their former spouse as a beneficiary that provision is void. Even if a divorced individual dies without changing their Will the former spouse is treated as predeceasing the decedent.  However, if a divorced individual did not change their beneficiary designation under an employee benefit plan the law did not affect that asset.

Now, if a beneficiary designation is made prior to the owner’s death on an employee benefit plan the designation is void when the marriage is terminated. The new law also applies to:

1. life insurance policy, qualified annuity or similar tax deferred plan held within an employee benefit plan;
2. employee benefit plan;
3. individual retirement account;
4. pay-on-death account;
5. security or other account registered in a transfer on death form;
6. life insurance policy, qualified annuity or similar contract not held within an employee benefit plan.

There are several exceptions to the new law most notably:

1. State administered retirement plans;
2. If the decedent remarries the individual whose interest would have been revoked;
3. If the designation of the former spouse is irrevocable under law or, not permitted by the written document; or
4. The assets is titled as co-owners where the death of one co-owner entitles the survivor to full ownership of the asset.

Because of these exceptions we recommend that all individuals who are divorced take affirmative action to review their estate plan and the titling of their assets with us and create a comprehensive, new estate plan.

“Proper Planning May Create Peace of Mind”
We are your and your clients’ partner in the aging process.
Let us help you and your clients navigate the elder law maze!