Do Same-Sex Married Couples Have the Same Estate Plan Advantages As Opposite-Sex Couples?
The Supreme Court’s decision striking down the Defense of Marriage Act (DOMA) has expanded estate plan advantages for married same-sex couples. For example, same-sex spouses can:
- Use the marital deduction to defer taxes when one spouse dies
- Elect estate tax portability to combine both spouses’ estate tax exemptions
- Avoid gift taxes when transferring assets between spouses
In addition, same-sex couples may benefit from availability of health insurance and Social Security, the ability to form marital trusts, and less difficulty accessing each other’s financial accounts.
Married couples should not take the expanded estate planning advantages for granted. Every couple needs an estate plan to cover not only what happens to each spouse’s assets upon death, but also end-of-life decisions.
What About Unmarried Same-Sex Couples?
Unmarried same-sex couples have even more need of comprehensive estate plans. Many unmarried couples have been together for a long time but have never done any estate planning. Because each partner often owns real estate or assets individually, a surviving partner may end up with no entitlement to the estate and little or no financial resources when one partner dies.
Preparing a simple estate plan can solve some of these problems. For example, you could sign a living trust that leaves your assets to your partner if you pass away. Along with the trust, you would sign a will placing all your assets in the trust upon death. You and your partner may agree to prepare advance directives in each other’s favors, allowing you to make medical decisions for your partner if he or she is incapacitated.
Partners should be aware that dying without a will may have unintended consequences. In California and other states, estate property passes by intestate succession when there is no will. That means close relatives, spouses, and children receive the estate. An unmarried partner would have no entitlement to any estate property. As a result, it is very important for you and your partner to sign properly prepared wills passing on your estates to your partners or whoever else you choose.
Planning your estate? Look to Janet Brewer, Esq. for thorough and thoughtful estate planning advice. Janet’s more than 20 years of legal experience will give you confidence and peace of mind. To schedule a “Get Acquainted” meeting, visit Janet's website or call her office at (650) 469-8206.