THE BASIC RIGHTS OF SURVIVING SPOUSE AND CHILDREN

This article addresses the basic rights of the surviving spouse and of children of the decedent who was a resident of Michigan at the time of death. There is another article that details more rights of surviving spouses and of children omitted from the wills of decedents entitled Spousal Election and Rights Of The Omitted Child.

Whether a resident of Michigan dies with or without a valid will, the surviving spouse and minor and dependent children of a decedent have certain rights to Homestead Allowance, Family Allowance, and Exempt Property. These rights are very important because they give a surviving spouse and eligible children estate assets ahead of all persons given specific gifts in a will and of most creditors of the deceased, but after the payment of funeral and burial expenses and the expenses of administering the estate.

The rights explained in this article are effective for all estates of persons who die after March 31, 2000. Through that date, these rights are now permanently determined under the Revised Probate Code. As of April 1, there are some significant differences in the amounts granted and who is entitled to receive the assets.

A Homestead Allowance of $15,000 is now awarded to the surviving spouse of a decedent who resided in Michigan at the time of death and dies after March 31,2000. Before April 1, 2000, this allowance was $10,000. MCL 700.2402

If there is no surviving spouse, the minor children and each “dependent child” of the decedent is entitled to the $15,000. In this situation, it is divided amongst the children in equal shares. Thus, if there are three eligible children, each will receive $5,000.

A “dependent child” is an adult child who was dependent upon the decedent at the time of decedent’s death. This is a new provision in the law. Proof of the dependency is required. However, if all the children agreed that the child is a dependent child, no court hearing would be necessary to prove it.

The Homestead Allowance is a first priority right and must be paid to those entitled to it. This allowance is in addition to any share of the estate passing to the persons by will, inheritance, or otherwise unless the will specifically states otherwise.

Another important allowance is the Family Allowance. This is to be in a reasonable amount and is not set by statute. However, a personal representative can determine that a reasonable allowance is $18,000 for the first year without having court approval. More than that amount will require court approval. The prior probate code required court approval for this allowance in all amounts. MCL 700.2403

The Family Allowance is payable to the surviving spouse for the use of the surviving spouse and minor and dependent children. If a minor or dependent child of decedent is living with someone other than the surviving spouse, part of this allowance may be paid to that child or to a person having the child’s care and custody. If there is no surviving spouse, it is payable to the children or to the persons having their care and custody.

A major change in the law now permits the Family Allowance to be payable to adult children if decedent was supporting them at the time of death. Also, it now permits the allowance to be payable to other persons who were being supported by decedent at the time of death. These other persons need not be children or heirs of decedent.

The purpose of the Family Allowance is to provide support for persons who were being supported by decedent at the time of death. It is intended to last only during the administration of the estate. If the estate has debts that exceed estate assets, this allowance can only be paid for one year.

After the Homestead Allowance is paid, the Family Allowance must be paid. It is paid ahead of gifts made in a will and most creditors but not funeral and burial expenses. This allowance is in addition to any share of the estate passing to the persons by will, inheritance, or otherwise, unless the will specifically states otherwise.

A third special right of the surviving spouse is to receive Exempt Property up to a value of $10,000. If there is no surviving spouse, the children, both adults and minors, are entitled to receive this property. This includes household furniture and furnishings, appliances, personal effects of the decedent, and automobiles. MCL 700.2404

If the property is subject to a security interest, the amount of the security interest is subtracted from the gross value of the asset. For example, if the decedent’s Ford Taurus is valued at $10,000 but has a security interest of $7,000 against it, the exempt property valuation would be $3,000. If the listed assets do not total at least $10,000, other assets of the estate, if any, are used to make up the difference.

Exempt property is paid only after both homestead allowance and family allowance have been paid or their payments guaranteed. As with the allowances, the right to Exempt Property is in addition to a benefit or share of the estate passing to the surviving spouse or to the children by will, inheritance, or otherwise, unless the will specifically states otherwise.

The Homestead Allowance of $15,000, the reasonable Family Allowance of $18,000 and the Exempt Property of $10,000 will be adjusted annually for inflation beginning January 1, 2001. However, it will only increase in increments of $1,000. A spouse can give up all or some of these rights at any time during his or her lifetime. This is sometimes done in prenuptial agreements involving a second marriage.

Surviving spouses have some additional, more complicated rights of election. These are detailed in another article along with the rights of a child who has been omitted from the will. You may find this article under the title: Spousal Election And Rights Of The Omitted Child. 

More information on this topic can be found at the Calhoun County Courts Probate Notes site.

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