No matter what your familial configuration or marital status, estate planning is something every person needs to address. But the rules are complicated, and changing, for same-sex couples.

Estate Planning for Married Same-Sex Couples

On June 26, 2015, the Supreme Court of the United States ruled that a state ban on same-sex marriage is unconstitutional as a violation of the equal protection clause of the Fourteenth Amendment. This decision struck down every state ban on same-sex marriage in the country, and by virtue of the ruling, also struck down Section 2 of the Defense of Marriage Act (DOMA), which declared that states have the right to deny recognition of same-sex marriages licensed in another state. As a result of this ruling, all 50 states and Washington, DC must now recognize same-sex marriages and issue marriage licenses to same-sex couples. As a result of United States v. Windsor, decided in 2013, the federal government also must recognize these marriages as valid.

Windsor and Obergefell create many estate planning opportunities for same-sex couples. As the estate planning attorney for married same-sex couples, we are able to take advantage of the unlimited marital deduction to delay or prevent any estate taxes in the future.  With the ability to delay estate taxes, same-sex couples may consider changing some of their life insurance to a “second-to-die” policy.

Same-sex couples should also review their beneficiary designations to ensure that they are appropriate given the changes to the law.   Other estate planning opportunities for same-sex spouses are splitting gifts between spouses, and seeking citizenship or permanent residency if one spouse is a US Citizen.

One of the more complicated issues for same-sex couples with estate planning is the characterization of property as community property and separate property.  Because same-sex couples are likely to have more separate property, especially if they are older, determining which property is separate property and which is community property is an important first step when preparing an estate plan for a same-sex married couple.  Also, same-sex couples may want to consider transmuting their separate property to community property for income tax purposes.  There are many other factors that should be considered before transmuting property.

Estate Planning for Unmarried Same-Sex Couples

While you may view your partner the same, whether you are married or not, the law does not view your partner in the same light.  In California, there is no common law marriage.  This means that if you or your partner dies without an estate plan, the survivor will likely not receive anything in probate.  For both married and unmarried same-sex couples it is imperative to have an estate plan that is specifically tailored to same-sex couples.

If you or a loved one is has questions about same-sex estate planning, contact John Wong, Orange County Estate Planning Attorney and Probate Lawyer at Modern Wealth Law.