Many married people who have prepared an estate plan leave the majority of their assets to their surviving spouse or to their children or other descendants if their spouse has already passed away. But what happens to your estate plan when you get divorced?
Under Minnesota law, a divorce will automatically revoke any provision in a will that leaves property to the ex-spouse. Instead, the assets pass to the recipients designated to receive them as if the ex-spouse had not survived the person who prepared the will.
Divorce also revokes any appointment of the ex-spouse as a personal representative, also known as an executor.
However, these automatic revocations can be overridden if a prenuptial or postnuptial agreement expressly states they will not apply (or by executing a subsequent will after the divorce).
Power of Attorneys
Many couples who have completed their estate planning also execute Power of Attorneys, which is a legal authorization for a designated person to make decisions about another person's property and finances. Power of Attorneys do not automatically revoke during the divorce process. If you have authorized your spouse to act on your behalf through a Power of Attorney it is important to revoke the Power of Attorney and notify all recipients of the Power of Attorney of the revocation at the start of a divorce. Failure to do so may permit your spouse to use the Power of Attorney against your interests.
Revocable Living Trusts
Many people with estate plans in Minnesota have opted to prepare a revocable living trust instead of a will — a revocable living trust can be changed over time. Minnesota’s trust law contains similar revocation provisions to those governing wills: a divorce automatically revokes any part of a trust created by one spouse that provides for payment of income or principal from the trust to an ex-spouse, or provides them with the beneficial enjoyment of any trust assets.
It is important to keep in mind that this automatic revocation generally applies only to revocable trusts; if a trust is irrevocable, it can be extremely difficult or impossible to revoke any of its terms.
Revising Your Estate Plan
Despite these automatic revocation laws, a Minnesota spouse going through a divorce will usually still want to revise their estate plan, particularly any provisions related to minor children. It is important to understand the effect of divorce on one’s own estate plan, on a spouse’s estate plan, and on any assets held by a trust, when negotiating the divorce property settlement.
Navigating Your Divorce
Existing estate plans or trusts are just one of many complicating factors in a divorce. To understand your options and begin charting a path forward, schedule a consultation with us today.