Same-Sex Couples: Three Estate Planning Steps to Take Now
The Supreme Court will rule on same-sex marriage this month, but couples will continue to face legal hurdles.
The Supreme Court could legalize same-sex marriage nationwide this month, but no matter what the ruling, same-sex couples will still face a confusing hodgepodge of laws and rights at the state level.
As such, estate planning should be an immediate priority for all same-sex couples. In order to ensure that assets are distributed according to plan should one spouse become disabled or die, couples should take the following steps:
Put it in writing. If a couple doesn’t legally document their wishes, then the default rules of the state apply. For example, when someone dies without a will, the state will divide assets among spouses or children according to pre-set percentages, which may not match up with the deceased’s wishes. Additionally, if the state does not recognize same-sex marriage, a same-sex partner may be left out altogether.
Consider a trust. A revocable living trust gives individuals the ability to manage and distribute assets in the trust without having to go through probate. If a trust isn’t used and the individual becomes incapacitated, a judge might appoint a relative—or, if there are no living relatives, a stranger—to serve as guardian to make health or asset distribution decisions for the disabled person. If the individual dies, the court will appoint an administrator to manage the person’s probate estate. In states that do not recognize same-sex marriage the individual’s spouse might have no say in the process.
Establish rights. Cash, investment accounts and real estate assets should be put into joint ownership, so they can pass automatically to the surviving joint owner. Additionally, if the couple has children but only one partner is a biological parent, the other should seek to legally adopt the child to establish parental rights, and receive custody of the child if the other partner becomes disabled or dies.
Estate planning is important for all couples, but especially same-sex couples. As legal matters regarding same-sex marriage continue to be sorted out at the state and national levels, it’s crucial for same-sex couples to create detailed, binding estate plans to ensure their wishes are carried out.
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