Microcontroller output override another signal, protect uC when powered off
A couple of points:

What prevents the output from going negative?

If you are counting on the Zener to do that, I would be careful.  The Zener won't clamp in the &quot;forward&quot; direction (In this case, ground to negative) until about 0.7V (which would let Output get to -0.7V).
I also wonder if the D2 TVS (which you show referenced to ground) can take a continuous -12V?

If Output can go negative, the NMOSFET has a parasitic diode that will turn on.

Most discrete NMOSFETs have a parasitic body diode pointing from source to drain (See the BSS138P datasheet for example: https://assets.nexperia.com/documents/data-sheet/BSS138P.pdf)  So, when you get some negative voltage on the drain, that diode will turn on.
The solution to this is to put two NMOSFETS in series back-to-back (ie. drains-tied or sources-tied) which causes the diodes to be pointing in opposite directions.
Then, if you got an NMOSFET with a threshold of about 1V, the NMOSFET will stay turned off until about -1V (G=0V, S=-1V, D=0V === G=1V S=0V D=1V) which gives the Zener enough margin to clamp the negative voltage.
Output would only go from about 0-4V (5V-Vth), but that's more than enough to trigger CMOS gates.
Hope this helps.