Articles by  Alice Reiter Feld

ESTATE PLANNING FOR THE PARTICULAR NEEDS OF UNMARRIED PARTNERS

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 issues. State inheritance laws will not apply and the partners will not be entitled to the same marital estate tax deductions as their married counterparts. Similarly, and maybe more importantly, partners are not afforded decision-making authority without 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 pointers:

Very Important! Have current and valid advance directives such as Living Wills, Health Care Surrogates, and Durable Powers of Attorney. Give copies to doctors and financial advisors. Without these documents other 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 produce some heart rendering results.

Also Very Important! Do your estate plan and make sure your will is current and updated. Consider preparing a cohabiting agreement expressing the partner’s intentions (like a prenuptial agreement). Be cognizant of how the title to property is held since assets held in joint tenancy will go to the joint owner and not in accordance with the will. If the estates are large, make sure that the partners have considered life insurance or other tools to reduce and avoid estate taxes.

Conclusion: The growing trend of unmarried partners has not been followed by the laws to protect this new arrangement. Therefore the partners must be vigilant in addressing all of the long-term care and estate planning issues between themselves and their attorney.