Why Marriage Can Be the Strongest Protection for LGBTQ+ Couples

For LGBTQ+ couples, marriage can mean much more than a wedding.

It can be one of the strongest legal protections available to a couple when one partner becomes incapacitated or dies.

That does not mean every couple should marry. Some couples choose not to, and there are many personal reasons for that decision.

But from an estate-planning perspective, there is an important difference between being married and being unmarried:

Marriage creates a legal relationship automatically. An unmarried couple has to create many of those protections themselves.

And that distinction can become very important when something goes wrong.

When you are married, the law already recognizes your relationship

Marriage provides a framework for property rights, inheritance, taxes, retirement benefits, and other legal matters.

For estate planning, the federal tax laws also provide important benefits for married couples, including the marital deduction for qualifying transfers to a surviving spouse.

An unmarried partner does not receive those protections simply because the couple has been together for decades.

There is no automatic inheritance right simply because you have shared a home for twenty years.

There is no automatic estate-tax marital deduction.

And there is no guarantee that an asset will pass to your partner simply because everyone in your life knows that your partner was the person you intended to protect.

That is why unmarried couples need to be particularly deliberate about their estate plan.

For unmarried couples, two trusts can often make things clearer

One of the planning questions we frequently discuss with unmarried couples is whether they should have one joint trust or two separate revocable trusts.

When each partner owns separate property, separate trusts can often provide a much cleaner structure.

Partner A can place Partner A's property into Partner A's trust.

Partner B can place Partner B's property into Partner B's trust.

Each partner can name the other as a beneficiary.

That allows the couple to plan together without necessarily combining ownership of everything they own.

It also makes it easier to answer an important question:

Whose property is this, and what happens to it when that person dies?

That becomes particularly important when the couple has children from prior relationships, different family members, separate businesses, inheritances, or different wishes about what ultimately happens to their property.

Otherwise, distributions can become confusing

Imagine an unmarried couple with a joint trust.

Partner A contributes a home and substantial investment assets.

Partner B contributes a business and retirement savings.

They both intend to take care of each other.

But what happens when Partner A dies?

Does everything become Partner B's?

Does some of it remain subject to Partner A's trust?

Does Partner B have the right to use the assets but not give them away?

What happens when Partner B later dies?

Who receives what remains?

These questions become much easier to answer when the ownership structure is clear from the beginning.

Separate trusts can allow each partner to say:

“These are my assets. I want my partner protected. And after my partner's death, I want the remainder to go to these people.”

That is often much easier to administer than trying to determine which partner's property went where after everything was placed into a single pot.

But what if you ultimately want everything to go to the same person?

This is where estate planning can become surprisingly simple.

Suppose an unmarried couple has separate trusts, but each partner wants the other partner to receive everything.

That does not necessarily mean they need one joint trust.

They can maintain separate ownership while coordinating the ultimate beneficiaries.

Partner A's trust can provide for Partner B.

Partner B's trust can provide for Partner A.

If both partners ultimately want the same person or people to receive whatever remains after both have died, their respective trusts can be drafted to accomplish that goal.

In other words:

Separate ownership does not mean separate lives.

It simply means that the legal ownership is clear while the estate plan can still be coordinated.

And the trust is only part of the plan

One of the biggest mistakes we see is creating a beautiful estate plan and then forgetting about the assets that pass outside the trust.

Your 401(k), IRA, life insurance policy, and other accounts with beneficiary designations need to be reviewed separately.

If your partner is supposed to receive those assets, the beneficiary designation should actually say so.

An old 401(k) beneficiary designation naming a parent or sibling can take precedence over what you intended your estate plan to accomplish.

The same is true for life insurance.

If you created your policy years before you met your partner, there is a very real possibility that the beneficiary designation has never been updated.

Your partner may be the person you consider your family today, while your insurance company still has a relative listed from a completely different chapter of your life.

That is why beneficiary designations should be reviewed whenever you create or update an estate plan—and particularly after marriage, divorce, the beginning of a significant relationship, the birth of a child, or another major life change.

Marriage is powerful. Planning is still necessary.

Marriage can provide an extraordinary legal foundation for an LGBTQ+ couple.

But marriage does not eliminate the need for an estate plan.

And for couples who remain unmarried, careful planning becomes even more important.

The goal is not to make your relationship unnecessarily complicated.

It is actually the opposite.

The goal is to make the legal structure as clear as the life you have built together.

Who owns the house?

Who receives the investment accounts?

Who inherits the retirement accounts?

Who receives the life insurance?

What happens if one partner becomes incapacitated?

And after both partners are gone, where does everything ultimately go?

Those questions may not be romantic.

But answering them is one of the most meaningful things you can do for the person you love.

Because when the law does not automatically recognize your relationship in the same way it recognizes a marriage, your estate plan has to do the talking for you.

Attorney Advertising. This article is for general informational purposes only and does not constitute legal, tax, or financial advice. Estate-planning and beneficiary-designation decisions should be made based on each couple's individual circumstances.