LGBT Estate Planning Frequently Asked Questions

LGBT Estate Planning Frequently Asked Questions

For current Estate and Gift tax figures, click here.

  1. Does same-sex marriage, domestic partnership, or civil union provide all the benefits of heterosexual marriage?
  2. I live in a state which recognizes my same-sex marriage, why do I need to plan?
  3. I live in a state that does not recognize our marriage, do I need to plan?
  4. Can my spouse or partner handle my financial affairs if I am incapacitated?
  5. Can my spouse or partner make medical decisions for me if I’m sick?
  6. How can I be sure that I will be allowed to visit my spouse or partner in the hospital or assisted living facility?
  7. Can I make decisions about my spouse or partner’s remains?
  8. Will my spouse or partner be appointed guardian of my minor child?
  9. Is there a tax if I give some of my property to my spouse or partner?
  10. Are my estate planning documents a matter of public record?
  11. Do same-sex couples have to plan more than heterosexual couples do?
  12. Is a Living Trust a good idea for a LGBT person?

Q: Does same-sex marriage, domestic partnership, or civil union provide all the benefits of heterosexual marriage?

A: No. These various relationships affect state law rights and responsibilities only in the states which recognize them. Only marriage is respected by the federal government. If you live in a state where your marriage is respected, all the same rights of heterosexual couples would apply under federal law. However, if you do not live in a state which recognizes your marriage, while your marriage will be recognized for federal tax purposes, it may not be recognized for other purposes of federal law. As a result, same-sex couples may not get some federal benefits, such as social security survivorship benefits.

Q: I live in a state which recognizes my same-sex marriage, why do I need to plan?

A: Even though your state may recognize your marriage, you may travel through or to states which do not recognize your marriage. If you do not plan, you and your spouse could be treated as “legal strangers,” preventing you for example, from having access to your spouse’s medical information should an accident occur. Additionally, there are many other important reasons to create an estate plan, such as avoiding probate, minimizing taxes and providing creditor and divorce protection for beneficiaries.

Q: I live in a state that does not recognize our marriage, do I need to plan?

A: Even though you are legally married, if the state in which you live does not recognize your marriage, you will be treated as “legal strangers” for purposes of state law and some federal laws.  As a result, if you do not have an estate plan, your spouse would not have the right to inherit from you, have preference to be appointed your guardian, or many other rights you would assume a spouse would have.

Q: Can my spouse or partner handle my financial affairs if I am incapacitated?

A: No, you have to do estate planning in order to allow your spouse or partner to have that authority. Specifically, by designating your spouse or partner as agent under a General Durable (Financial) Power of Attorney, he or she can make decisions on your behalf regarding financial matters.

Q: Can my spouse or partner make medical decisions for me if I’m sick?

A: If you are in a same-sex marriage, registered domestic partnership, or civil union, recognized by the state in which you live, your spouse or partner can make those decisions for you. If you are not in a registered relationship, or that relationship is not recognized by your state, then state law would recognize your family of origin to make those decisions. However, you can override state law and give your spouse or partner the authority to make such decisions by signing a Health Care Power of Attorney. With such a document, when you are unable to make your own medical decisions, your spouse or partner can step in and speak for you. Further, this document will designate your spouse or partner as your choice to be guardian for you if one needs to be appointed. Without such a designation, your family of origin would have priority for such an appointment.

Q: How can I be sure that I will be allowed to visit my spouse or partner in the hospital or assisted living facility?

A: If you are in a state that recognizes same-sex marriage, civil unions, or domestic partnerships and you register as such, proof of such registration would be sufficient. Otherwise, you would need to have your spouse or partner designate you as agent under their Health Care Power of Attorney. The agent also can limit other visitors.

Q: Can I make decisions about my spouse or partner’s remains?

A: Yes, if you are in a registered relationship and in a state which recognizes that relationship.  However, if you’re either, i) not in such a registered relationship, or ii) you are in a state which does not recognize that relationship, then default state law allows your spouse or partner’s family of origin rather than you to make those decisions. However, if your spouse or partner designates you as agent under their Health Care Power of Attorney, then you would be able to make such decisions.

Q: Will my spouse or partner be appointed guardian of my minor child?

A: Unless your spouse or partner has adopted your minor children, a court would decide what would be in the child’s best interest. Typically, your family of origin and that of the child’s other biological parent are given preference by the court. However, in your last Will, you can nominate your spouse or partner to be the guardian for your minor child. The court will then give weight to your suggestion while weighing what is in the child’s best interest.

Q: Is there a tax if I give some of my property to my spouse or partner?

A: Maybe. Federal law allows married couples to give each other an unlimited amount of property without gift tax during life or estate tax at death. Federal law does not recognize non-marriage relationships.  However, each person gets to give up to his or her tax exclusion during their lifetime to anyone they want. But, any use during lifetime reduces the amount available for transfers at death. In addition, anyone can make a gift to any other person, called the Annual Gift Tax Exclusion, without gift tax and without reducing his or her estate tax exclusion.

Q: Are my estate planning documents a matter of public record?

A: Only your Will is a matter of public record. Your Revocable Living Trust and your Powers of Attorney are not public. Therefore, by using a Revocable Living Trust you can maintain the privacy of your wishes. Prying eyes of co-workers and neighbors will not have access to the details of your estate plan.

Q: Do same-sex couples have to plan more than heterosexual couples do?

A: Yes. The default in state law, called “intestacy,” is designed with heterosexual couples in mind. If a heterosexual couple dies without any estate plan, the survivor will get a good portion of the assets left behind. However, unless you are in a state that legally recognizes same-sex marriage, domestic partnership, or civil union and you have registered as such, the survivor would get nothing. Instead, the family of origin of the spouse or partner who died would get anything in that partner’s name, including bank accounts, real estate, etc.

Q: Is a Living Trust a good idea for a LGBT person?

A: Yes. If you’re part of the Lesbian, Gay, Bisexual, and Transgender community, a Living Trust offers protection for your estate, as well. It will completely eliminate a living probate, a death probate, and you can minimize or eliminate estate taxes. Further, it allows you to override the laws that fail to recognize the importance of your domestic partnership.

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