In: Categories » Legal and finance » Real estate » ESTATE PLANNING FOR UNMARRIED AND GAY AND LESBIAN COUPLES
| Estate planning has not to be analyzed from the point of view of a married couple only. Unmarried or gay and lesbian couples can benefit of the same kind of estate planning. In fact, the opposite is true. Estate planning becomes even more important if you aren’t married, but share your life with someone. Both unmarried straight and gay couples don’t benefit from the same protection under the law that married couples do. First, when you die, your property will pass to others in one of four ways: • automatically through joint ownership (bank accounts, house, etc.) If you haven’t made arrangements to have your property and assets pass to your beneficiaries through any of the first three methods, your property will automatically pass through probate. By having a legal will, you will avoid having the courts decide who receives your assets. If you don’t, you will lose control of who receives your estate. If you were to die intestate, the law first considers that the assets go to the spouse. If there is no spouse, then they flow to any children. If there are no children, then the assets go to the parents; if there are no parents, then they go to the grandparents, and so on. As I’ve stated before, the law doesn’t allow any leniency for close friends or your favorite charity to inherit your assets. You need to make that sure you put your wishes in writing. For gay and lesbian relationships, Vermont is the only state that recognizes the surviving partner in intestacy laws. You need to consider that, by law, whoever is listed on the title to any property is considered the legal owner, unless there is a legal agreement that states otherwise. If you die, your partner (unlike your spouse) won’t have any legal right to your property if that person wasn’t registered as a legal owner. Your partner would have to establish that he or she was legally part owner of the property, and thus, entitled to it after your death. Most states won’t accept a verbal agreement to that effect, they’ll only take it in writing. Special note: Be careful of how you are titling your assets. Many times, unmarried gay and straight couples will want to show how committed they are to their relationships by putting their partner’s name on their accounts. However, if those accounts are valued at more than $11,000, your loving gesture may be considered a gift, and you could be subject to paying gift tax. There are ways to get around any potential gift tax that your CPA can help you explore. A will may not be sufficient on its own, though. You may find that you will need a trust. If that’s the case, you will have the same options that married couples do. You want to be sure that your partner is taken care of if you pass away. Estate planning is vital, no matter how big or small your estate is. You’ve worked too hard to increase your net worth, save for your retirement, etc., to see a large portion of your money go to the government. I’ve yet to meet any people that say they are so excited to die because then the government will finally be able to collect all that money from their estate. Actually, that’s a rather ridiculous statement, isn’t it? But, for many people, that’s what happens. Failing to do proper estate planning will have no effect on you during your life, but it will have a dramatic effect on the lives of your spouse, children, and other heirs.
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