South Carolina Laws on Separated Spouses as Beneficiaries

When someone drafts a will to name the persons they wish to inherit their assets when they die, a married person usually identifies their spouse as a beneficiary. And even if they don't, in South Carolina, a surviving spouse gets a substantial share of the estate.

On the other hand, in most cases, a divorced spouse is not entitled to a share, and the same is true when the couple is legally separated.

Just as marital situations can be extremely complicated, South Carolina laws about marriage, separation and divorce are also quite complex. Anyone living in this state will want to get a complete overview of how marital status affects the share of a surviving spouse in an estate.

For many people, a last will and testament is an important part of their estate plan in South Carolina, as in many states. An individual uses this legal document to set out whom they want to inherit their property when they die.

The person is called the testator, the sum of the property is termed their estate, and the people named to inherit are referred to as beneficiaries.

But a beneficiary is not limited to an estate. It can be anyone named to receive property from an individual after they die. For example, it is possible to name beneficiaries in your will, on life insurance policies or on retirement and bank accounts.

Quite naturally, a married person who dies often names their spouse as a beneficiary in a will. But naming a surviving spouse as a beneficiary doesn't mean that certain life events won't invalidate or change beneficiary designations. The laws on this subject vary from state to state.

In South Carolina, when a person divorces or legally separates from their spouse before they die, this will have an effect on beneficiary designations.

Disinheriting someone means cutting them out of a will, removing them as a beneficiary. Some states and many counties prohibit disinheriting children, but South Carolina is not one of them. An individual is free to disinherit their adult children in their wills, but there are different rules when it comes to a spouse.

Under South Carolina law, it is not possible to prevent a current spouse from taking a substantial part of the estate when their spouse dies. If the couple is married at the time of one spouse's death, the surviving spouse can file a claim for an elective share of the estate, and can do so up to eight months after the death or within six months after the probate of the decedent's will, whichever limitation last expires.

Absent some valid written agreement waiving this right, like a valid prenup, for example, a surviving spouse is legally entitled to inherit one-third of the deceased spouse's estate.

An omitted spouse is different from a disinherited spouse, and the difference depends on when the will was drafted. If the spouse who died wrote a will while married to the current spouse without naming her as a beneficiary, that spouse gets an elective share of one-third of the estate, as described above.

However, if the deceased spouse drafted a will before the current marriage and forgot or neglected to update it, the current spouse is omitted, not disinherited. In South Carolina, leaving the spouse out of the will is considered to be unintentional.

South Carolina law provides a remedy for omitted spouses. Under South Carolina Code Section 62-2-30, when a testator fails to make a surviving spouse a beneficiary of a will, and the most recent will was dated before the current marriage, a surviving spouse gets considerably more.

They are entitled to the same share of the estate that they would have received if the decedent left no will at all and died intestate.

That spouses share is 50 percent of the estate if the decedent also left children, or 100 percent if they did not leave any issue. If language in the will shows that the omission was intentional, such as where the will itself states that the decedent does not intend to provide for any future spouse, the surviving spouse gets only the statutory elective share.

What if a spouse dies without a will? The estate is said to be intestate, and South Carolina law determines the legal heirs. Since the deceased did not leave a will saying who they wish to be beneficiaries, the state makes the best guess, assuming that the deceased would want to provide for surviving children and spouse.

Under the state's intestacy laws, a surviving spouse gets 50 percent of the estate if the deceased also leaves children, or 100 percent if there are no children. A valid prenuptial agreement waiving these rights will be upheld, however.

Some assets and accounts allow the owner to set up a "payable on death" designation, naming a beneficiary who will automatically become the owner in case the owner dies.

If an individual owns assets with beneficiary designations, these are not covered by the South Carolina probate laws regarding inheritance, and the named beneficiary takes the asset outside of any probate proceeding.

This makes sense since the assets never become part of a deceased's probate estate. Rather, these assets, like life insurance policies and retirement accounts, pass directly to the named beneficiaries. Federal law sometimes applies to these assets, like ERISA retirement and pension plants and 401(K) plans.

An individual can generally name anyone at all – relative or no – as the beneficiary of an IRA or insurance policy, even if they are married. But federal plans are different. It is necessary to actually remove a spouse's name as beneficiary after a divorce. Forgetting to do this means that the spouse will take the asset.

To alter the beneficiary designation on an ERISA account requires the submission of a qualified domestic relations order, (QDRO) to the plan administrator. Without this QDRO, the plan has no choice but to award the benefits to the ex-spouse beneficiary.

​Obviously, spouses are married if they have gone through the legal ceremony in South Carolina or some other state or country. In this case, they are married whether or not they live together, whether or not they like each other, and whether or not they talk of divorce or even file for it.

The rights of a spouse discussed above also extend to a common law spouse, if the common law marriage was entered into after the execution of the decedent’s last will.

Common law marriage was outlawed progressively in 2019, but South Carolina accepted the notion of common law marriage for many years. And marriages entered into before 2019 are still considered valid.

A common law marriage is defined as a marriage between two people without a formal wedding ceremony. To form a common law marriage in South Carolina, the couple must have entered into the marriage before 2019 and met four requirements:

• They must both agree to a common law marriage.
• They must both have “legal capacity," meaning at least 18 years old and mentally competent.
• They must cohabit.
  
• They must hold themselves out as married.
  

A legal divorce automatically extinguishes all rights of a surviving spouse to inherit their elective share, their omitted spouse share, and the spouse's intestate share. This makes sense, since the couple are no longer legally married.

Even if the deceased forgot or neglected to change their will after the divorce order, the fact of the divorce invalidates any provisions for the spouse.

What about separation? That depends on how the term is being used. "Separation" is an often misunderstood transition between marriage and divorce. If one of the spouses moved out of the house and set up a different residence, they may feel that they are separated. But they are still married in the eyes of the law, and the spouse will be entitled to beneficiary status.

However, a legal separation – a separation arrangement approved by the South Carolina courts – will terminate a spouse's beneficiary/heir status. To further complicate matters, South Carolina doesn't recognize the concept of legal separation.

The closest option for spouses who no longer want to live together, but are not yet ready to divorce, is called an Order of Separate Maintenance and Support.

Although South Carolina does not recognize legal separation as a separate marital status, the courts can and do issue Orders of Separate Maintenance and Support. These orders set out the details regarding child custody, visitation, spousal support/alimony and child support arrangements.

They also discuss how marital assets should be maintained and how marital debts are to be paid. An Order of Separate Maintenance and Support is a temporary order not intended to cover other divorce issues, and it does not.

This order is, in fact, considered the first step in the South Carolina no-fault divorce process. In South Carolina, spouses must separate – live separately in different locations – for one year before they are eligible to file for a South Carolina divorce. Living in separate bedrooms in one house is not sufficient.

While it is not mandatory for spouses to get an Order of Separate Maintenance and Support to live separately in preparation for a divorce, doing so can protect their financial interests and resolve visitation and custody issues during the separation period.

Does an Order of Separate Maintenance and Support end a spouse's rights to be a beneficiary/heir in South Carolina? The law is not settled on this issue. The fact is that the parties are still married, and it is possible that a probate court will award the spouse a share of the estate.

The best course may be to put a provision in an Order for Separate Maintenance and Support agreeing that both spouses waive the right to claim an elective share of the other’s estate.

To obtain an Order of Separate Maintenance and Support, one of the spouses files a Complaint for an Order of Separate Maintenance and Support, and a Notice and Motion for Temporary Relief in the South Carolina Family Court where the couple was living.

Like every other legal filing, these documents must be personally served on the other spouse, who has 30 days to file an Answer, in response to the Complaint. They can also file a counterclaim, giving the court their plan for the issues in the case.

The matter is then heard by the judge. They decide the issues or review and approve a separation agreement between the parties. The court order controls the issues until the spouses reach a final divorce.

It's always a good idea to amend a will after important life events. A divorce is obviously one of these events that merits a new will. While this may not be actually necessary, depending on the circumstances, it is always a wise backup measure to block a divorced spouse from taking estate assets.