Only 22% of the people in this country live in what we call Traditional families. There are approximately 5.5 million ‘unmarried partner’ households in the United States. Although unmarried partners face some of the same estate planning challenges as married couples, their situation creates unique and potentially problematic issues.
State inheritance laws will not apply and the partners will not be entitled to the same marital estate tax deductions as their “lawfully married” counterparts. Similarly, and maybe more importantly, partners are not afforded decision-making authority without proper legal documentation.
Because the client cannot rely on any ‘default’ laws or legal protections provided by the states in favor of spouse, critical attention to detail is necessary in order that all contingencies are covered and the client’s estate planning goals are met.
Some Additional Important Options and Tools for Unmarried Partners
Very Important! Have current, valid legally-executed ‘Advance Directives’ such as Living Wills, Health Care Surrogates, and Durable Powers of Attorney. Give copies to doctors and financial advisors. Without these documents family members can block access to a sick partner, make health decisions without consent of the partner and even make funeral and burial arrangements without the consent or input of the partner. This can result in significant and life-altering emotional pain.
Also Very Important! Do your estate plan and make sure your Will and/or Trust is current and updated. Consider preparing a ‘cohabiting agreement.‘ This details each partner’s intentions, much like a prenuptial agreement. Be cognizant of how real property is titled, since assets held in joint tenancy will go to the joint owner and not in accordance with the Will. If your estate is significant, make sure that both partners have considered life insurance or other tools to reduce and/or avoid Estate Taxes.
Think carefully about your Estate Plan. If there are children from prior relationships, think about how you are going to protect and provide for them. It can be traumatic for family members who are omitted.
Conclusion: Laws have not yet been adjusted to follow and protect the growing population of unmarried partners, to the detriment of 78% of us.
Therefore the partners must be vigilant in addressing all of the Long Term Care and Estate Planning issues between themselves and their attorney.
You can listen to our FREE Audio-CD and read our Special Report that discusses the Critical and Unique Elder Law and Estate Planning Issues for Unmarried Partners, by clicking here to go to our FREE Online Elder Law, Estate Planning, And Special Needs Resource Center.