The recent U.S. Supreme Court decision that overruled the Defense of Marriage Act (DOMA) has changed laws affecting same-sex couples. But even before the attempts to equalize the rights of same-sex couples, opposite gender unmarried partners have been struggling to be granted the same rights as legally married couples especially in an estate planning context. Even in states that recognize same-sex marriage, heterosexual couples who are not married still face the same issues that used to apply to same-sex partners. Now that same-sex marriage is recognized by federal law and in the states where it has been legalized, those couples are entitled to many of the same legal benefits as married couples of opposite genders. But because unmarried couples are not “spouses” under the law, they must pay particular attention to estate planning.
In Arkansas, when you die without a will, the law requires that your descendants receive a share of your estate with your spouse possibly receiving dower and some other rights to part of your property. If you don’t have children and were married at least 3 years, your estate passes to your spouse. If you have no spouse, your estate passes to your other blood relatives including siblings, parents, and even grandparents and aunts and uncles. If the court cannot find any of those relatives, the state will get the assets of your estate.
Let’s examine what that means in real terms for an unmarried couple of opposite genders. If your partner is not your “spouse,” your children, if you have any, will get the assets of your estate. If you have only one child who is from a previous marriage or relationship who doesn’t like your partner and is estranged from you because of your relationship, he or she will still inherit your estate. If your child gets everything, chances are your partner will get nothing. If you have no children, your estate will pass to other blood relatives, including those who have never approved of your relationship because you have never married. Instead of your long-term partner, your relatives will inherit your assets and again, your partner will likely get nothing. If none of your relatives can be found, the state will “inherit” your estate through a process called escheat. Any claims for your assets must be filed within seven years, but, because your partner is not considered a legal heir, chances are he or she will still get nothing from your estate even after filing a claim.
So what estate planning solutions are available to you? The simplest solution is a will that leaves all, or a share, of your estate to your partner. But your will must be probated, which means a notice must be published. Anyone with a claim against your estate can file for whatever share they think they should get. Or they can file suit and contest the will, which requires your partner to face the loss of time, money and control that goes with defending, and possibly losing, a lawsuit. A better solution may be a trust. A revocable living trust can be created during your lifetime and direct how you want your assets handled after your death – and even before. If you become incapacitated and want your partner to care for you, the trust can provide the instructions and financial assets to keep your care under his or her control. A trust is not public, so no one has to know how you have distributed your assets.
Estate planning in any situation can have pitfalls but situations involving unmarried partners can pose significant issues. Consulting an estate planning attorney who understands the unique concerns of an unmarried couple could save your loved one time, money and emotional distress when you are incapacitated or die.