Estate Planning for Same-Sex Couples

Estate planning is important for every adult. Your gender, age, race, and marital status, while all part of your identity, don’t change the fact that you have the ability to have a say about your wishes for your medical care, minor children, and your property should you become ill or pass away. For same-sex couples, there are some nuances of estate planning to consider, especially if you were together prior to same-sex marriage being legalized in 2015 and you haven’t updated your estate plan since then or created one at all. While state laws do provide many legal safeguards, a customized estate plan can go above and beyond to make your voice heard. See why estate planning for same-sex couples is especially important and the specific ways you can protect who and what matters most to you.

HOW OBERGEFELL V. HODGES INFLUENCED ESTATE PLANNING FOR SAME-SEX COUPLES

Before we jump into estate planning tools, it’s good to understand how Obergefell v. Hodges (the U.S. Supreme Court’s landmark case to legalize same-sex marriages) impacted the rights and estate plans for married members of the LGBTQ community:

1. Property rights – a tenancy by the entireties is a form of joint property ownership only available to a married couple. Property owned as tenants by the entireties includes a right of survivorship, so that upon the death of the first spouse, the property automatically passes to the surviving spouse. The additional benefit of a tenancy by the entireties is that in most instances, a creditor may only make a claim against the entireties property if the creditor has a claim against both spouses. Prior to same-sex marriage legalization, property ownership as tenants by the entireties was not permitted by a same-sex couple.
2. Taxes – both Pennsylvania and the federal government impose a tax on the value of assets a person owns at the time of his or her death, but assets passing to a surviving spouse are not subject to tax at the state or federal level. Same-sex married couples now enjoy this benefit as well.
3. Wills – sadly, many Americans die without an estate plan, most notably a Will. If you are married and pass away as a Pennsylvania resident without a Will, your spouse (and any children) inherits your estate under intestacy law. Prior to the Supreme Court’s ruling in 2015, same-sex couples that died without Wills would not have had their assets automatically pass to their partner under Pennsylvania’s intestacy laws, and they would have had to specifically name their partner in a Will in order for them to inherit their estate.

In short, heterosexual couples enjoy many benefits that same-sex couples didn’t prior to marriage equality. But just as Roe V. Wade was overturned in 2022, some LGBTQ activists wonder if the same fate could befall Obergefell v. Hodges, meaning same-sex couples would no longer enjoy the same marriage benefits when it comes to estate planning. Fortunately, estate planning can help ensure same-sex couples enjoy many of these same protections regardless of whether their marriage is legally recognized.

THINGS TO CONSIDER WHEN ESTATE PLANNING FOR SAME-SEX COUPLES

Rather than turning to DIY estate documents, it really benefits all individuals, especially members of the LGBTQ community, to work with an experienced estate planning attorney to help create meaningful and effective documents. Estate plans for same-sex couples take into consideration the following:

• Homeownership – “do the deed” and have the deed to your home updated to reflect your spouse as a joint owner of the property as tenants by the entireties. This ensures that the home will automatically pass to your surviving spouse at your death and gives you the added liability protection discussed above.
• Elective shares – you cannot DISINHERIT YOUR SPOUSE IN PA, and your spouse has the right to claim an elective share, i.e., one-third of your estate. If you have children or other beneficiaries in mind, consider addressing this in a PRE- OR POST-NUPTIAL AGREEMENT. Regardless of what marriage laws are now or in the future, specifying what you want your partner to have in a Will is a wise idea.
• Beneficiary designations – if you have a retirement account or life insurance policy, you’ve always had the ability to designate your beneficiaries, regardless of marital status (but as to certain retirement accounts, you may be required to name your spouse as the beneficiary absent a waiver from your spouse). Be sure to update your beneficiary designations to ensure they reflect your wishes, also keeping in mind these documents supersede a Will.
• Guardianship – if you have minor children, whether biological for one partner, from a previous marriage, or adopted before or during your same-sex marriage, make sure you document your guardianship wishes, or “people to avoid” list, in a Will. Additionally, if either you or your spouse is a biological parent of your children, consider SECOND-PARENT ADOPTION to help ensure your parental rights are secure and unchallenged.
• Powers of Attorney – a Health Care Power of Attorney and Living Will authorize an Agent to make medical decisions on your behalf while you are alive but unable to voice your wishes. A DURABLE POWER OF ATTORNEY authorizes an Agent to make financial or property decisions under similar circumstances. While a spouse may fulfill these roles, they are not always the best fit. Discuss this with your partner and document it in your plan.
• Trusts – especially if your same-sex marriage is your second one and makes your family a blended one, a TRUST can protect your assets and make sure your spouse has what’s intended for them after you pass while allowing you to control the distribution of the remaining assets at your spouse’s death.

SUCCESSFUL ESTATE PLANNING FOR SAME-SEX COUPLES

Estate planning for same-sex couples has unique challenges, and in the ever-changing legal landscape, creating these documents to reflect your wishes now and in the future helps preserve your love and your legacy.

Have questions about a pre-existing estate plan or interest in making a new one? Our Estate Planning & Trusts attorneys are here to help you protect you, your family, and what matters most.