Estate Planning and Real Estate Considerations for LGBTQ+ Couples
June 26, 2015 was a day in history not easily forgotten. It was the day that same-sex marriage in the United States was established in all 50 states. It was a landmark decision by the Supreme Court to legalize these marriage ceremonies and make a major move toward marriage equality in America.
And, since July 9, 2015, just 13 days after the ruling, Attorney General Loretta Lynch announced that federal marriage benefits will be available to same-sex couples nationwide. This includes filing joint tax returns, listing spouses to receive health insurance, and spousal protections in the event of death, as well as veteran benefits.
While these decisions are one big leap toward a more equal America for all, there is always the decision to not marry and instead remain an unmarried, same-sex couple. If that is a decision a couple chooses to make, there are some estate planning and real estate scenarios and laws to be aware of.
At Kira Doyle Law, we adamantly support our LGBTQ+ neighbors and those individuals and couples nationwide. Our goal is to help you prepare for life, whatever your life choices may be, and to support your real estate goals, whatever those may look like.
Here is a breakdown of unique challenges LGBTQ+ couples may face in the legal fields of estate planning (and protecting their assets) and real estate.
Estate Planning for Same-Sex Couples
While estate planning is an important part of life planning for anyone, same-sex couples and families should pay special attention to their plan for protecting their assets and other end of life planning scenarios that will come up, such as the designation of a healthcare surrogate.
For legally married partners, there are default legal provisions in place that provide for a spouse in the event that one spouse dies with a Will. However, an unmarried couple is not met with these same rights.
Proper documentation must be in place to ensure that should something happen to you, your same-sex partner has the legal ability to execute parts of your estate plan, and receive any assets you have chosen for him or her. We recommend a comprehensive estate plan for this purpose. These documents in a comprehensive plan include: a Last Will and Testament, Durable Power of Attorney, Designation of Healthcare Surrogate, Declaration of Pre-Need Guardian, Living Will and, if needed, a Revocable (“Living”) Trust and Pour-over Will.
When it comes to legally married same-sex couples, there are some recommended steps to take when updating your estate plan. We highly recommend that a review be completed of any estate planning documents that were executed prior to 2015. All documents remain the same, whether for a same-sex couple or not, but spousal language (husband, wife, spouse) can be updated to be more consistent with current laws.
LGBTQ+ couples should also consider looking into their beneficiary elections. If a previous spouse or partner is listed, or the document is simply outdated, a quick update can ensure that your current spouse will receive any assets listed in that benefit.
One of the largest assets for most people is a retirement account. Married same-sex couples are now able to not only list their spouse as a beneficiary of these accounts, they are also able to roll over their own assets from his or her retirement account to the account of their spouse, and all without having to choose a minimum or lump-sum distribution.
Real Estate Considerations for Same-Sex Couples
Both married couples and partners, no matter their sexual orientation, are going to share a marital home. However, depending on your status as a legally married couple in the eyes of the State, your options for titling of your real estate will differ.
If you are part of an opposite-sex marriage, and both spouses take title at the same time, this is referred to as tenancy by the entirety. With this method of titling, both spouses own the marital home equally, meaning, either spouse needs the consent of the other spouse before any updates or changes to their interest in the property can be made.
When a home is titled as tenancy by the entirety, couples are protected from estate issues and gift tax liability in the event of the death of a spouse. This occurs because the property will be owned by the sole surviving spouse. Tenancy by the entirety also offers protection against creditors of one spouse from taking action on the property owned by both.
Something to consider: In Florida, it is not just real estate that can be owned as tenancy by the entirety; instead, all property of a couple can be titled in this way.
However, this is not necessarily the same case with same-sex couples who are legally married.
In Florida, same-sex marriages are recognized, but it remains to be seen if Florida will recognize tenancy by the entirety for same-sex married couples. Currently, spouses are not protected from the creditors of their partner because any judgments must be cleared prior to a clean title being issued. This is different from what opposite-sex couples face.
Same-sex couples may choose to title their marital home in another way, such as “joint tenants with rights of survivorship”.
If property is titled as joint tenants with rights of survivorship, a surviving spouse can ensure that they become the sole owner of a shared home after the death of their partner. If the property is not titled in this way, the home is subject to probate and there is no guarantee that the surviving spouse will have rights to the property.
Real estate laws are constantly being evaluated and updated, and Florida law could update to provide better guidance on this issue. Until then, engaging an experienced real estate attorney can help you navigate this uncertain situation.
Ask a Florida Attorney for Assistance!
Estate planning and real estate transactions can be complicated matters, but the experienced attorneys at Kira Doyle Law can walk you through the process and ensure that the rights of you and your spouse are kept a top priority. If you are interested in life planning and making sure jointly owned property is properly conveyed, contact our St. Petersburg office at 727-537-6818 to schedule an appointment with one of our experience estate planning and real estate attorneys today!