Iowa Spousal Elective Share - It is Official Now

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In a ruling issued today by the Iowa Supreme Court, the Court ruled that a spouse can be cut out of an elective share by utilizing a non-probate transfer.  In the Myers case, the decedent had placed beneficiary designations on a checking account, CD and an annuity to her children and not her husband.  The trial court initially had ruled that those assets, despite the beneficiary designation, were still subject to the spousal elective share based on earlier court rulings.

However, on appeal, the Iowa Supreme Court determined that the statutory language of the spousal elective share provisions (Iowa Code § 633.238) specifically limits the elective share to ONLY the probate property.  Thus, payable on death (POD), transferable on death (TOD), or any other account that has beneficiaries listed upon death could be passed on to other beneficiaries and exclude the spouse.  In other words, if you want to disinherit your spouse, this is how you accomplish that result.

This ruling at least clears the issue in Iowa, for now, as there have been conflicting cases, including one I wrote about a few years ago.

An interesting fact that may have played a role in this case--or maybe not--was that the surviving spouse had assigned his elective share rights to a judgment creditor and it was the judgment creditor that was seeking to enforce the elective share rights.  If this was a destitute surviving spouse living on cat food and government support programs, would the court have made the same decision?  Probably will never know.  Sometimes bad facts create bad law.

Comments

chrissue said…
What year was the elective share law in effect in Iowa?
5:02 PM
matthewgardner said…
Long, long, long time ago. Before I was birthed. But modified most recently in 2015.
8:50 AM
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