Tuesday, September 30, 2014
Estate Planning: 6 Key Areas to Protect Interests for Same-Sex Couples
What’s often overlooked is the way in which estate planning for same sex couples can be considerably more difficult than what’s considered conventional. If you take for example the situation in Texas wherein same sex marriage is not recognized by the Texas Family Code and the Texas Constitution, it’s unsurprising that things can get somewhat complicated for those not up to speed with legal matters.
Same sex marriage was made legal by the US Supreme Court recently, which has in turn led to a great many questions and misunderstandings from those looking to marry and live under the ruling. Just as is the case with male and female couples, estate planning for same sex couples is crucial in order to ensure that all affairs are handled both efficiently and properly in the event of the death of one or both parties. Failing to plan correctly can mean leaving all manner of problems both legally and financially for loved ones to face, which is precisely why the recommendation is to cover all bases sooner rather than later.
Estate planning for same sex couples is best approached and dealt with as early as possible, in order to allow plentiful time for any obstacles or hold ups to be accounted for, as there are many elements to the process, which will be touched upon below.
Perhaps the most common known and to some extent understood element of the modern estate plan, wills are of crucial importance and serve as the very foundation of all plans made. In terms of time savings alone they can be worth their weight in gold, as a will allows for all named possessions and assets to be transferred to those inheriting them without having to go through any legal battles or allocation systems.
When it comes to same sex couples, the only difference is that it must be written in the will that their married partner will receive their assets; otherwise none will be passed on. In a male and female marriage it is automatically the spouse that takes ownership of their deceased partner’s assets, but this is not the case with same sex marriage. As this kind of marriage is not recognized in Texas, the marriage is seen more as a cohabitation of single people and therefore does not work in the same way when assets are to be passed on. A will is therefore of utmost importance.
Powers of Attorney
Powers of attorney refer to the scenario wherein one partner is able to make decisions on behalf of the other due to their own inability to do so. It could be due to medical reasons or any kind of disability, but if the individual cannot make decisions about their own assets and medical care, their partner needs powers of attorney in order to do so. Once powers of attorney have been granted by an individual, their partner can make the decision.
In a standard male and female marriage, the individual’s spouse is usually given power of attorney as soon as the other is unable to continue making their own decisions. However, as Texas does not recognize same sex marriage as a legal marriage in the same way, powers of attorney must be requested, granted and verified in advance. As it is impossible to predict when and where this kind of decision making power may be needed, it is crucial to organize and obtain powers of attorney at the earliest possible opportunity.
Directives To Physicians
Directives to physicians refers to the powers given to any individual to take charge over the matter of treatments to be offered and surgeries to be carried out should they not be able to make their own decisions at any given time. This differs from powers of attorney as it is the executor that makes the decisions in advance and makes their wishes clear earlier on. The benefit of this is knowing that everything that follows will be the express wishes of the executor, which can often be preferable to putting the difficult decisions into the hands of a loved one.
This is another crucial part of estate planning for same sex couples to consider, especially for those wishing to ensure their own demands and met should they no longer be able to make decisions.
Disposition of Remains
Another key element of the process is that of ensuring that disposition of remains is established by the executor, which works in a similar fashion to the above. This is where the executor makes the decision as to what they would like to be done with their remains the very moment they die, which no other party is then allowed to alter under any circumstances. Again, this can bring a great deal of peace of mind to loved ones who may otherwise be faced with a troubling decision to make.
A cohabitation agreement works on a similar principle to a prenuptial agreement as often used in male and female marriages. As the state of Texas does not recognize same sex marriage, the usual rules do not apply when it comes to either dividing assets upon a split or reallocating assets following bereavement. It’s important to know where all assets and debts lie in order to ensure that they can be handled and redistributed appropriately after death or a breakup.
Just like a standard premarital agreement, it’s possible to specify that everything will be split right down the middle, or be as specific as required with each individual asset. This is one of the most important estate planning measures of all as it gives total peace of mind to know that no matter what happens, everything has been allocated in advance.
Retirement Plans and Life Insurance
Finally, it is important to ensure that any life insurance and retirement plans are tailored in a manner that specifies a same sex partner as the beneficiary or as required anywhere else as this will not simply be assumed as standard where same sex marriage is not recognized.
Labels: california estate planning attorney, death tax, Dwight Edward Tompkins, Estate Planning, Estate Taxes, inheritance tax, Living Trusts, same sex couples, Tax Planning, Tompkins-Law
I help people protect their families through affordable, personalized estate planning. Tompkins-Law.com I am in solo practice in Orange County, California where I focus on estate planning, family trusts, living trusts, wills, corporations and business succession planning. I speak Spanish and serve the latino community. Fideicomisos-Testamentos.com