The sentence a divorce lawyer needs to see
Florida divides marital property by equitable distribution. Section 61.075 begins from an equal split and then lets a court depart from it on a list of statutory factors. Those include contributions to the marriage, economic circumstances, the duration, career sacrifices, intentional dissipation of assets, and more.
Inside a community property trust, none of that applies.
Upon the dissolution of the marriage of the settlor spouses, the community property trust shall terminate and the trustee shall distribute one-half of the trust assets to each spouse in accordance with subsection (3). For purposes of this act, s. 61.075 does not apply to the disposition of the assets and liabilities held in a community property trust.
Section 736.1508(1), Florida Statutes.
Half each, and the judge’s discretion to do otherwise is removed.
That cuts both ways and it is worth being blunt about which. A spouse who contributed most of the assets loses the ability to argue for more than half of what went into the trust. A spouse who contributed little is protected from an argument that they should receive less. Whoever put more in is the one giving something up, and that is the trade being made when the trust is created, years before anyone is thinking about divorce.
This is what section 736.1503(4) means when the statutory warning says the consequences include your rights with your spouse at the time of a divorce. The Legislature wrote that warning in capital letters, and this is the section behind it.
The 180 day clock
Filing for divorce does not end the trust by itself. Subsection (2) provides that initiating the action does not automatically terminate it unless the spouses agree in writing or the court orders it.
Then comes the clock.
However, if an action to dissolve the settlor spouses’ marriage remains pending for 180 days, the trust automatically terminates and the trustee must distribute one-half of the trust assets to each spouse in accordance with subsection (3), unless any of the following apply:
Section 736.1508(2), Florida Statutes.
Four things stop it.
- An objection within 180 days. A settlor spouse objects to termination within 180 days of the filing, and then either party may ask the court whether good cause exists to terminate during the case.
- A court order directing otherwise.
- A written agreement between the spouses while the action is pending.
- The trust agreement providing otherwise.
The objection route repays attention because of its timing. The objection must come within 180 days following the filing, which is the same period after which termination would otherwise be automatic. A spouse who wants the trust kept together during a long divorce has to act inside that window, and the court then decides on a good cause standard the statute does not define.
Two limits on how the trustee divides
Subsection (3) gives the trustee flexibility and then takes some back.
The flexibility comes first. Unless the agreement says otherwise, the trustee may distribute in divided or undivided interests, adjust for differences in valuation, and make distributions in kind on a non pro rata basis, a pro rata basis, or both. So the trustee can allocate whole assets rather than slicing each one in half.
The first limit is practical and welcome.
A trustee may not distribute real property or business interests in a manner that would leave the settlor spouses as co-owners of such assets post dissolution of the settlor spouses’ marriage or termination of the community property trust, unless otherwise agreed to by the settlor spouses in a separate written agreement executed during the dissolution of marriage action.
Section 736.1508(3), Florida Statutes.
Nobody is forced into business with an ex spouse. The only way out of that rule is a separate written agreement, and note when it must be made. It has to be signed during the dissolution action, not before it and not after.
The second limit protects the whole point of the arrangement.
Notwithstanding any other provision of this section, the community property trust agreement cannot be terminated, and the assets cannot be distributed, in a manner that could cause the trust assets to not be treated as community property.
Section 736.1508(3), Florida Statutes, closing sentence.
Read could cause, not causes. That is a deliberately low threshold, and it makes the tax character of the property a constraint on how a divorce is settled. A distribution scheme that merely risks the treatment is prohibited.
One court, including over the trustee
Subsection (4) gives the court handling the dissolution personal and subject matter jurisdiction over the settlor spouses and the trustee, for the purpose of effectuating the distribution consistent with the trust agreement and in a manner ensuring the assets retain their community property character.
That is unusual and sensible. Without it, a divorce court might have to leave the trust to a separate proceeding under section 736.0201, with a different judge and a different timetable. The Legislature put everything in one courtroom.
No court has construed this section
Our review found no citing decision, with a Florida court filter and nationwide, at every precedential status.
We do not present that as a finding. Part XV took effect on July 1, 2021, only trusts created or amended from that date qualify, and this section operates on divorce. A qualifying trust, then a marriage breakdown, then litigation, then an appeal, in five years, is simply unlikely. The silence tells you about the calendar, not about the law.
What is genuinely open is the good cause standard in subsection (2)(a), which is undefined, and the reach of the closing sentence of subsection (3). A distribution that could affect community property treatment is prohibited, and who decides that, on what evidence, has not been tested.