The United States Supreme Court ruling that made same-sex marriage legal in all fifty states makes estate planning and paying taxes much easier for same-sex married couples, as reported in The Huffington Post article, “5 Estate Planning Tips LGBT Families Need to Follow in 2016.” Here are some tips that all couples need to bear in mind when starting their married lives.
- Make a Will. A will can do several things to protect your assets and wishes when you die. It prevents costly probate issues, properly divides your assets per your wishes and can provide guardianship of your children. If you die without a will in place, intestate succession happens, which varies by state.
- Look at a Prenup. It’s not too romantic to ask your partner after saying “yes” to a marriage proposal to sign a prenuptial agreement. But this agreement lets you enter into a legal and financial arrangement prior to the wedding, and you can avoid some legal issues if you divorce.
- Sign a Power of Attorney. If you’re married, don’t just assume that your spouse is automatically granted power of attorney over your affairs. There needs to be a power of attorney created, and it can be for either or both financial and health care control. If your spouse becomes incapacitated, you’ll be able to make financial and health decisions on his or her behalf. Also, note that while a living will lets you state the kinds of health care you wish to have, a power of attorney allows your spouse to make decisions on your behalf.
- Examine your Estate Tax Liability. The state where you live may have its own estate tax at a low threshold. For federal taxes, estates worth over $5.45 million need to pay federal estate tax.
- Prepare for Change. LGBT estate planning still needs to consider what would happen if the current legal environment changed. If the Supreme Court decision was overturned or other legal challenges arose, would your plan hold up? Consider having a few documents in place, just in case: A Domestic Partnership Agreement, a Living Will and a Living Trust.
- Prepare for Mortality. Include practical details like how your funeral will be paid for, whether you want to be buried or cremated, what kind of casket or urn you desire and other admittedly unpleasant details. You will give your partner the gift of knowing what you wanted during a difficult time.
Reference: Huffington Post (July 13, 2016) “5 Estate Planning Tips LGBT Families Need to Follow in 2016”