Those who are recently divorced or who are going through a divorce may not realize the important role that estate planning should play in the process. Many ex-spouses have been the unintended beneficiaries of assets just because an ex-spouse forgot to do something (like change a beneficiary form!). This document is a general explanation of the relevant issues, there is also an Estate Planning Checklist for the Newly Divorced.
Understanding what you may need to do depends upon whether you are actually divorced or still the process of getting a divorce. During a divorce, Kentucky law still considers you to be legally married. This is true until a final dissolution decree is signed by a judge ending the marriage. This means that in the event you were to die or become disabled prior to the legal termination of your marriage, your estranged spouse may have legal control over you and your estate, and may be entitled to at least half of your estate. Please consult with your divorce attorney before taking an action on your assets.
However, for those that are already divorced, understanding how property title impacts your assets at your death will assist you in making decisions. This is a bit complicated, but it is important because it could make a big difference if something unexpected happens to you.
If you own property in your own name without survivorship, without a “pay on death” designation, or without a beneficiary designation, then your property will likely pass by your last will and testament at your death. Kentucky law treats your former spouse as if he or she died before you. For most divorced people, this is a good thing. Oh, and if you do not have a last will and testament, the state in which you live has written one on your behalf and if you are divorced, your former spouse will not receive assets.
So, you may be thinking that Kentucky law has resolved the issues for me – if I die my former spouse gets nothing under my will. Great! Well, not so fast. Not all of your assets may be subject to your last will and testament. It depends upon title to your asset. If you have assets that are survivorship, “pay on death,” or beneficiary designation (an IRA, an insurance policy, or an annuity), in most cases those are not subject to your last will and testament. Because these types of assets are not related to probate and your last will and testament, the law revoking the spouse does not apply. In short, if you forget to take your former spouse off of a beneficiary form, and he or she outlives you, he or she will be entitled to that property if you died. This is probably not what you want.
Taking to proper steps to separate yourself from your ex-spouse requires planning outside the context of the actual divorce proceedings. As a guide, Goldberg Simpson, LLC has developed an Estate Planning Checklist for the Newly Divorced, we hope makes this process easier.
This article was prepared by Kelli E. Brown, J.D., LL.M.
We also refer you to our Divorce and Dissolution of Marriage FAQ:
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