Estate planning is the most often neglected aspect of a couple’s life. Many couples have no will, no health care power of attorney (saying who makes your health care decisions when you cannot), durable power of attorney (allowing someone to act on your behalf if you are unavailable, unconscious, etc.), and living will (saying whether you want to be kept alive if you are in a persistent vegetative state). Even if you have wisely taken care of all of this however, there is a law that may defeat your wishes as to where you want your assets to go when you die.
N.C.G.S. §30-3.1, the Elective Share statute, was enacted in 2014, and applies to all deaths after October 1, 2013. It provides as follows:
- If the decedent and the surviving spouse were married less than five (5) years, the surviving spouse is entitled to fifteen percent (15%) of the decedent’s net assets;
- If the decedent and the surviving spouse were married at least five (5) years but less than ten (10) years, the surviving spouse is entitled to twenty-five percent (25%) of the decedent’s net assets;
- If the decedent and the surviving spouse were married to each other at least ten (10) years but less than fifteen (15) years, the surviving spouse is entitled to thirty-three percent (33%) of the decedent’s assets; and
- If the decedent and the surviving spouse had been married to each other fifteen (15) years or more at the time of the decedent’s death, the surviving spouse is entitled to fifty percent (50%) of the decedent’s net assets.
If you do not have a will, this statute can potentially cause a problem with your estate where it appears to conflict with the state’s intestate succession statutes (what happens when you die without a will).
If you have a will, this law could completely defeat your desired distribution of assets through your will.
If you are in a situation where you have a prenuptial agreement, or re-married, or married later in life and have children from another relationship, the Elective Share statute could defeat your intentions with regard to distributing your estate.
- EXAMPLE: You have a prenuptial agreement that says what you had when you came into the marriage is yours, and what your spouse has is theirs, even if you later divorce. The Elective Share statute could be argued to override the prenuptial agreement, and even if you were separated at the time you die, a court may decide to distribute 50% of all of your assets to your estranged spouse. The same is true if you have a post-nuptial agreement. This gets even more complicated if there is a pending claim for equitable distribution when you pass.
- EXAMPLE: You have a family from a previous relationship and want to leave all of your assets to them. Your will spells this out. If you die after being married 15 or more years, your surviving spouse could instead ask the court to give them 50% of everything you owned, and then distribute what is left to your family.
What do I need to do?
- The safest thing to do is have an attorney with estate planning experience review your situation.
- The law allows you to sign waivers giving up your elective share.
- Your prenuptial or post-nuptial agreement may adequately waive this elective share—but it may not.
- We Can Help! Call our office and we can arrange to review your situation to ensure your estate will be distributed the way YOU want it to be.
For Tony, the law is a calling, not a job. He is a mountain boy, with simple, straightforward values. Tony loves what he does, and loves to help people through some of the toughest moments anyone will ever face. Learn More