By: Laura M. Torres González, Esq.
Financial Planner / Assistant Vice President
Wealth Management Division, BPPR
Most of us cannot imagine the sudden loss of our spouse. Should this happen to you, you might be thrust into economic self-survival mode at a time when you may feel particularly vulnerable and least able to cope. The earlier you begin to educate yourself concerning these matters, the better prepared you may be to withstand the impact of facing sudden loss. An important part you need to understand is whether your spouse is an heir to your estate.
Under Puerto Rico laws whether a spouse is an heir to his or her spouse’s estate may vary depending on the marriage’s economic regime, mainly on whether there is a prenuptial agreement or not. In the absence of a prenuptial agreement, the surviving spouse is entitled to half of all the marriage’s assets as part of a marital community. Under a prenuptial agreement, the widow or widower might be entitled only to half of the assets acquired jointly as a partnership, if any.
What is the surviving spouse’s usufruct quota?
The surviving spouse is entitled by Puerto Rico law to a hereditary portion of the deceased spouse’s estate and is considered a forced heir, but only with respect to the limited right of usufruct (“usufructo viudal” in Spanish). Such right allows the holder to take advantage and profit from personal or real property part of a portion of the deceased spouse’s estate.
For the spouse to have a right to the quota he or she had to be married to the deceased at the time of death. The marriage’s economic regime does not affect this right to receive the usufruct, and the right cannot be renounced. Even if the deceased spouse has left a will that makes no mention of this right, the widowed spouse is still entitled to it.
The value of the usufruct and the source of its payment will depend on how many and who the other forced heirs are. The heirs can pay the usufruct to the widow in cash, from the product of specific assets or through a lifetime income. While the surviving spouse cannot force the heirs to satisfy the quota in a particular manner, he or she can take the matter to court if harmed by the selected means. While the usufruct is unpaid, the spouse has a levy over the entire inheritance, and has the right to intervene in the estate’s partition.
Understanding the order of succession
The widow or widower could have a right to the entire inheritance if the deceased had no descendants (children or grandchildren) or ascendants (parents or grandparents). The widowed spouse has the right to inherit before the brothers and nephews of the deceased. The inheritance order in Puerto Rico is the following: descendants, ascendants, surviving spouse, preferential collaterals (siblings and nephews), ordinary collaterals (uncles and cousins) and the Commonwealth of Puerto Rico.
If you have descendants or ascendants but want to leave your spouse an additional portion of the estate, you can do so through a will.
Can you inherit life insurance?
It is worth mentioning that life insurance benefits are not included as part of the inheritance. The spouse may be protected by designating him or her as a policy beneficiary. This type of strategy is utilized in the purchasing of a home or stocks of a corporation that belongs to the married couple, when the designation of the free disposition portion in the will is insufficient.
Adequately preparing for these events can have a huge impact on you and your loved ones. Consult your Popular One financial planner today to design the strategy that best fits your needs.
Banco Popular de Puerto Rico, its subsidiaries and/or affiliates do not engage in the offering of tax, legal, or accounting advice. If legal, tax, or accounting assistance is required, the services of a competent professional should be sought.