§ 62-2-207 — Charging spouse with gifts received; liability of others for balance of elective share.

(a) In the proceeding for an elective share, all property, including any beneficial interest, which passes or has passed to the surviving spouse, or would have passed to the surviving spouse, but was renounced or disclaimed, must be applied first to satisfy the elective share and to reduce any contributions due from other recipients of transfers included in the probate estate, so long as the property is passed to the surviving spouse: (1) under the decedent's will; (2) by intestacy; (3) by a homestead allowance; (4) by Section 62-2-401; (5) by a beneficiary designation in life insurance policies; (6) by a beneficiary designation of an Individual Retirement Account, qualified retirement plan, or annuity; (7) in a trust created by the decedent's will; or (8) in a revocable inter vivos trust created by the decedent. (b) A beneficial interest that passes or has passed to a surviving spouse under the decedent's will includes: (1) an interest as a beneficiary in a trust created by the decedent's will; (2) an interest as a beneficiary in property passing under the decedent's will to an inter vivos trust created by the decedent; and (3) an interest as a beneficiary in property contained at the decedent's death in a revocable inter vivos trust found to be illusory, as provided in Section 62-7-401(c). (c)(1) For purposes of this provision, the value of the electing spouse's beneficial interest in property which qualifies for the federal estate tax marital deduction pursuant to Section 2056 of the Internal Revenue Code, as amended, or, if the federal estate tax is not applicable at the decedent's death, would have qualified for the federal estate tax marital deduction pursuant to Section 2056 of the Internal Revenue Code, as amended, in effect on December 31, 2009, must be computed at the full value of the qualifying property. Qualifying for these purposes must be determined without regard to whether an election has been made to treat the property as qualified terminable interest property. (2) The value of this qualifying property shall be the value at the date of death as finally determined in the decedent's estate tax proceedings, or if there is no federal estate tax proceeding, as shown on the inventory and appraisement or as determined by the court. The personal representative must choose assets, in order of abatement pursuant to Section 62-3-902, to satisfy the elective share, using the fair market value at the date of distribution. The elective share is pecuniary in nature. (3) The electing spouse who is the income beneficiary of a trust, the value of which is treated, or could be treated, as qualifying property, shall have the right to require a conversion of the income trust to a total return unitrust as defined in the South Carolina Uniform Principal and Income Act. (d) In choosing assets to fund the elective share, remaining property of the probate estate is applied so that liability for the balance of the elective share of the surviving spouse is satisfied from the probate estate, with devises abating in accordance with Section 62-3-902.

Legislative History

HISTORY: 1986 Act No. 539, SECTION 1; 1987 Act No. 171, SECTION 8; 1990 Act No. 521, SECTION 17; 2010 Act No. 181, SECTION 1, eff May 28, 2010; 2013 Act No. 100, SECTION 1, eff January 1, 2014. Effect of Amendment The 2010 amendment rewrote the section to include language regarding trusts. Part 3 Spouse and Children Unprovided for in Wills