A wide power to agree, with three outer limits
Subsection (1) lets the spouses settle the essentials between themselves, namely their rights and obligations in the property regardless of when and where it was acquired, its management and control, its disposition on dissolution, death or another event, and whether the trust is revocable or irrevocable.
Then a catch all, and its limits are the interesting part.
Any other matter that affects the property transferred to the trust and does not violate public policy or general law imposing a criminal penalty, or result in the property not being treated as community property under the laws of a relevant jurisdiction.
Section 736.1504(1)(e), Florida Statutes.
The first two limits are conventional. The third is not. The spouses may not agree anything that would stop the property being treated as community property, which makes the tax objective a boundary on their own freedom of contract. The same instinct appears in section 736.1508(3), where the trust cannot be wound up in a way that could cause the assets not to be treated as community property.
And disposition terms under (1)(c) are expressly subject to sections 736.1507 and 736.1508, so the death and divorce rules cannot be contracted around. A couple cannot agree that the survivor takes less than half, or that a divorce produces an uneven split.
Revocable unless you say otherwise
A community property trust may be amended or revoked by the settlor spouses unless the agreement itself specifically provides that the community property trust is irrevocable.
Section 736.1504(3), Florida Statutes.
The default is revocable, and irrevocability requires the agreement to say so specifically.
That will surprise anyone who assumes a tax motivated trust must be irrevocable. It need not be here, because the objective in section 736.1511 depends on the character of the property rather than on the settlors giving up control.
It also means a couple can change their minds. If the arrangement stops suiting them, they revoke. The consequence of revoking is in section 736.1505(5). Property distributed out of the trust stops being community property under this Part, except for property that was community property under another jurisdiction’s law.
The survivor cannot be locked in
In the event of the death of a settlor spouse, the surviving spouse may amend a community property trust regarding the disposition of that spouse’s one-half share of the community property, regardless of whether the agreement provides that the community property trust is irrevocable.
Section 736.1504(2), Florida Statutes.
Read regardless of whether the agreement provides that the trust is irrevocable. Even a trust drafted as irrevocable cannot stop the survivor redirecting their own half after the first death.
That fits section 736.1507, under which the survivor’s half was always theirs and was never the decedent’s to dispose of. The decedent’s half goes wherever their will directs; the survivor’s half stays under the survivor’s control.
For a couple in a second marriage this matters in both directions. You can control your own half after death. You cannot control your spouse’s. A trust that appears to bind both halves does not do so.
The subsection that overrides the whole Code
Notwithstanding any other provision of this code, the settlor spouses shall be deemed to be the only qualified beneficiaries of a community property trust until the death of one of the settlor spouses, regardless of whether the trust is revocable or irrevocable. After the death of one of the settlor spouses, the surviving spouse shall be deemed to be the only qualified beneficiary as to his or her share of the community property trust.
Section 736.1504(4), Florida Statutes.
Notwithstanding any other provision of this code is about as strong as statutory language gets, and here it does something substantial.
Qualified beneficiary status is the currency of the Florida Trust Code. It carries the right to be kept reasonably informed and to receive accountings under section 736.0813, and a say on a range of matters. Who holds it is normally decided by section 736.0103(19), and in an irrevocable trust the remainder beneficiaries ordinarily qualify.
This subsection switches that off. While both spouses live, the children and every other remainder beneficiary are not qualified beneficiaries, even if the trust is irrevocable. They are entitled to no accountings and no information.
The rationale is coherent. The property is the spouses’, they are both alive, and giving the next generation a right to inspect a married couple’s finances would make these trusts unusable. But the practical effect deserves stating plainly, because it is the opposite of what an adult child of a first marriage would expect on being told they are a beneficiary of an irrevocable trust.
After the first death the second sentence takes over. The survivor is the only qualified beneficiary as to his or her share. The words as to his or her share imply that as to the decedent’s half, ordinary rules resume and the decedent’s beneficiaries acquire status. The section does not say so expressly, and nobody has had to decide it.
No court has construed this section
Our review found no citing decision, with a Florida court filter and nationwide, at every precedential status.
The open question is the one just noted, and it is the kind that produces litigation. After the first death, who is a qualified beneficiary as to the decedent’s half. The subsection addresses the survivor’s share and is silent on the other, and the answer determines whether the decedent’s children can demand an accounting from a trustee who may be their surviving stepparent.