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LGBTQ Estate Planning

Estate Planning, Guardianship, Wills

Bill* had a lot of debt when he unexpectedly died. His partner of 30 years, Jerry, lived with Bill and was Bill’s sole beneficiary pursuant to Bill’s Last Will and Testament. However, because the two were not married and did not jointly own the house or any other assets, everything Bill owned at the time of his death was subject to multiple creditors’ claims.

Jerry had no choice but to move so the house could be sold, and the creditors could be paid. It was a sad and confusing time for Jerry.

This situation isn’t unique to same-sex couples. When the U.S. Supreme Court legalized same-sex marriage in 2015, it’s fair to say that not every couple rushed to the altar. The wait to be married was a long one for many couples and some may have thought: “Why bother?”

Domestic Partnerships, Civil Unions and Marriages in New Jersey

In the State of New Jersey, domestic partnerships were legalized in 2004 for same-sex couples age 18 and older and opposite-sex couples age 62 and over. In 2007, the Civil Union Act became effective, allowing same-sex couples age 18 and older to establish a civil union. The Civil Union Act amended the Domestic Partnership Act so that only people aged 62 and older could apply for domestic partnerships.

The Civil Union Act gives same-sex couples the same state rights as married couples. Couples who stay in a civil union and don’t marry are treated no differently in New Jersey, but federal laws do not apply. This can impact benefits, estate distribution and, as discussed above, inheritance taxes.

New Jersey has taken same-sex marriage protection one step further by passing a law in February that codifies marriage equality into state law. Assembly Bill A5367 was introduced by state lawmakers who feared the U.S. Supreme Court may overturn same-sex marriages.

LGBTQ Estate Planning

There are tax and estate planning benefits that come with marriage. LGBTQ couples can protect their rights and interests through proper estate planning with an experienced estate law attorney. Some of the legal issues same-sex couples should consider planning for include:

  • Decision-making Authority: Through documents like a power of attorney, trust and advanced healthcare directive, a person can select a representative to ensure his or her health care and financial needs are handled per their preferences should they become incapacitated.
  • Will: A Will is important if the couple is married or not and if they have children.
  • Guardians of Minors or People with Special Needs: If the couple is raising children outside of marriage or a legalized adoption, or caring for someone with special needs, it is important that guardianship documentation be included in estate planning.
  • Transgender Issues: Legal issues can arise if a person’s gender does not match their birth certificate. This can cause problems in the event of a health emergency as well as in probate court.

*Names have been changed to protect privacy.

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