Question: What do unmarried couples need to consider in preparing an estate plan?
Answer: Unmarried couples in some cases may face special estate planning challenges. In particular, an unmarried couple with a very large combined estate could be problematic from an estate tax standpoint.
So what happens if an unmarried couple (like most Americans), never does any estate planning?
If one partner were to become incapacitated, the other partner would have no legal authority to handle the personal, financial or medical affairs of the incapacitated partner. The healthy partner might have to file a court petition to be appointed as the incapacitated partner’s legal guardian. If there is opposition from any of the incapacitated partner’s other family members, the healthy partner’s lack of legal standing might prevent him/her from becoming the guardian, thereby not getting control.
In the case of one partner dying without a Will, the surviving partner has no statutory rights to any of the deceased partner’s property. The laws of intestacy will typically provide for spouse, children and other blood relatives (but not an unmarried partner).
Accordingly, it is important for an unmarried couple to make sure they have estate planning documents, Wills, Trusts, Powers of Attorney, and Medical Directives.
Comment: Equally important, if a couple wishes that the surviving partner receive some or all of the first partner’s retirement accounts and life insurance proceeds upon the first partner’s death, it is important that the beneficiary designations for these types of assets name the partner as the beneficiary.
As always, if you have any questions or would like to learn more, please contact Steve Shane at firstname.lastname@example.org or .
ABOUT STEVE SHANE
Steve Shane provides strategic counseling to clients in need of estate administration, charitable giving and business continuity planning while minimizing estate, gift, and generation-skipping transfer tax exposure. He offers legal guidance to clients on asset protection and the proper disposition of assets in accordance with the client’s objectives, while employing tax planning techniques such as the use of irrevocable trusts, life insurance planning, lifetime gifts and charitable trust. He is also experienced with drafting documents for business planning, the incorporation and application for exemption for Private Foundations and the administration of decedents’ estates.
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