Love and Estate Planning

by | Feb 18, 2016 | 0 comments

Ah, love. Love is a many-splendored thing. It is heart palpitations when your loved one draws near. It is reading the same book over and over and over because your four-year-old can’t go to sleep without it. It is…an estate plan? Discussion about end of life care? Absolutely yes.

The importance of estate planning and discussions is heightened for LGBTQ folks. One of the saddest calls I receive as an attorney is from LGBTQ individuals who have lost their partner or spouse, only to learn that the estate, or their partner’s financial assets, are going to the very family members who rejected the decedent for being LGBTQ. In one case, the estranged family members literally showed up at the door of the house within a week of a woman’s death, demanding to come in to remove furniture from the house shared by a couple who had been together for more than 20 years, and who had been rejected by that same family. Ultimately, they also took the retirement accounts and individual bank accounts because the deceased had failed to name a beneficiary. Under the law, they had that right. A simple will would have changed everything.

Please note that no short article like this can address all of the complexities of individual situations or estate tax advice, so this is not meant to provide legal advice. Rather, I will provide general information and strongly encourage you to take action to provide real support and security for those you love.

The first step every single one of us should do is to gather information from every retirement plan, pension plan, bank account, life insurance policy, investment account or any other financial vehicle. You need to look to see who you named as the beneficiary of the plan, account, etc. Oftentimes, we name someone when we first establish the account, and then completely forget about it. That means your mom or your first boyfriend or your BFF you haven’t seen for 20 years will get that money even if you have a will naming your spouse! That’s because these kinds of assets do not pass through the probate estate, and instead go directly to whoever is named on those designation lines. Seriously. Go check it now. I’ll wait for you here with further instructions.

Welcome back. Hopefully as an interim step, you have checked all of those accounts and changed them as necessary. You’re not out of the woods yet. Do you own real estate? Have you checked to see how you own it? This information is on the title and is not controlled by who is on the mortgage. Each ownership option (e.g., joint tenants with right of survivorship, or tenants-in-common) comes with a different impact when you die.

Assets that do not have a direct beneficiary designation are controlled by someone’s will or estate plan. If you don’t have a will, your assets will go where the State wants it to go, and not necessarily where you want it to go.

The best way you can protect your loved ones is to establish an estate plan. You say you don’t need one because you don’t have any money? First, maybe you’ll exit the earth via an accident caused by one of the Koch brothers. Suddenly, your estate is huge. Second, good planning with small or large estates includes things such as powers of attorney for health care and signed HIPAA releases so you and your loved ones can make medical decisions for each other, durable powers of attorney for finances so that you can manage financial matters while you are alive, and advanced directives to medical professionals, advising them how you want to handle end of life issues. These documents are very simple, but they are crucial to ease the burden of your loved ones in a time of crisis.

Now for good news: estate planning is not nearly as expensive as you think. If you have addressed your direct beneficiary designations, you have already started the process and it didn’t cost you a dime! A good estate planner will take a look at those beneficiary designations and let you know if there is a better way to designate beneficiaries (e.g., name a trust for your children as the beneficiary) and will create a detailed plan for you. The cost for a simple will can be as little as a couple hundred dollars and the cost for all but the most complex estate plans designed to address complex tax issues rarely exceeds $3,500. Be wary of the “free” estate planning seminars that are designed to sell you a big fat trust document you do not understand and most people do not need.

When you are looking for estate planning professionals, be sure to ask them whether they have special training or experience working with LGBTQ individuals and families. While marriage equality has reduced some of the distinctions between LGBTQ folks and our hetero counterparts, many people choose not to marry for various reasons, but still want to provide for their loved ones. Also, there are issues that are unique to our families, especially involving children.

These topics aren’t easy, but if you love someone (and I bet you do), or someone loves you (yes, they do) you will make this a priority to either establish or update your estate plan to ease the burden of your loved ones. Now go pack a lunch for your honey and include a love note. You’ll thank me for it later.

Michele Perreault is an attorney for DeWitt Ross & Stevens. Recently, she’s presented “Protecting Children of Gay and Lesbian Families: Challenges, Opportunities, and Where We go From Here.”

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