Once the amount of the elective share is determined[1], that amount may be “satisfied” if the value of the assets the surviving spouse received from the decedent or will receive from the decedent on death exceed the value of the elective share. §732.2075(1)(a), F.S. The following six categories of property pass to or for benefit of the surviving spouse, and therefore “satisfy”, in whole or in part, the value of the elective share:[2]

I. PROPERTY PASSING TO OR FOR BENEFIT OF THE SURVIVING SPOUSE:

  1. Contingent interests. §732.2075(1)(a), F.S. This category includes property interests included in the elective estate that pass or have passed to or for the benefit of the surviving spouse, including interests that are contingent upon making the election, but only to the extent that such contingent interests do not diminish other property interests that would be applied to satisfy the elective share in the absence of the contingent interests.
  1. Retirement plan or similar arrangement. §732.2075(1)(b), F.S. To the extent they are payable to or for the benefit of the surviving spouse, this category includes amounts payable under any qualified or unqualified retirement plan or similar arrangement described in §732.2035(7), F.S. Exceptions: Benefits received under social security or the Railroad Retirement Act.
  1. Community property. §732.2075(1)(c), F.S. To the extent payable to or for the benefit of the surviving spouse, this category includes the decedent’s one-half of any community property described in §732.2045(1)(f), F.S.
  1. Qualifying special needs trust. §732.2075(1)(d), F.S. This category includes property held for the benefit of the surviving spouse in a qualifying special needs trust as defined in §732.2025(8), F.S.  
  1. Elective share trust. §732.2075(1)(e), F.S. This category includes property interests included in the elective estate that pass or have passed to or for the benefit of the surviving spouse, such as the value of the spouse’s interest in an elective share trust as defined in §732.2025(2), F.S.  
  1. Spousal disclaimer. §732.2075(1)(f), F.S. This category includes property interests that would have been applied in satisfaction of the elective share but for the fact that the spouse disclaimed them.

II. VALUATION:

Generally.  Exclusive of the spouse’s interest in a trust, property passing outright to the spouse is valued at its fair market value on the date the spouse takes possession of the property, or, in the case of property passing by right of survivorship, the date of the decedent’s death. §732.2095(1)(a) and (2), F.S. If the spouse is entitled only to the use or possession of the property for life, (i.e., a life estate) the spouse’s life interest is valued at one-half of the value of the underlying property. §732.2095(2)(a), F.S.

Qualifying special needs trust. The value of the spouse’s interest is the value of the principal of the trust, or trust portion, on the date of the decedent’s death. §732.2095(2)(c), F.S.

Elective share trust. The value of the spouse’s interest is a percentage of the value of the principal of the trust, or trust portion, on the applicable valuation date as follows: (1) one hundred percent if the trust instrument includes both a qualifying invasion power[3] and a qualifying power of appointment;[4] (2) eighty percent if the trust instrument includes a qualifying invasion power but no qualifying power of appointment; (3) fifty percent in all other cases. §732.2095(2)(b), F.S.

Other trusts. If the surviving spouse has an interest in a trust that does not meet the requirements of either an elective share trust or a qualifying special needs trust (for example, a trust where the spouse is entitled to income or an annuity for a term period), the value of the spouse’s interest is the transfer tax value[5] of the interest on the applicable valuation date; however, the aggregate value of all of the spouse’s interests in the trust will not exceed one-half of the value of the trust principal on the applicable valuation date. §732.2095(2)(d), F.S.

[1]  Elective estate x 30% = Elective Share

[2] Exception: Unless otherwise provided in the decedent’s will or, in the absence of a provision in the decedent’s will, in a trust referred to in the decedent’s will, the six categories are applied first to satisfy the elective share. §732.2075(1), F.S.

[3] The term “Qualifying invasion power” is defined in §732.2095(1)(c), F.S.

[4] The term “Qualifying power of appointment” is defined in §732.2095(1)(b), F.S.

[5] “Transfer tax value” is defined to be the value the interest would have for gift tax purposes if the interest was assigned to an unrelated person.§732.2025(11), F.S. The reference to “unrelated person” insures that gift tax value will be made without regard to the special valuation rules found in Chapter 14 of the Internal Revenue Code.