In the wake of the U.S. Supreme Court's ruling legalizing same-sex marriage across the nation, many New Yorkers who are in same-sex relationships may be curious about what the ruling means for estate planning. Previously, same-sex couples did not enjoy some of the tax and estate benefits as people in heterosexual marriages. However, now those advantages are available to same-sex couples as well.
When a married couple purchases a home together, they can own it as a joint tenancy by the entirety. This allows the home to pass directly and with full ownership to the other spouse if one passes away. Thus, Same-sex married couples may want to consider retitling their properties in both names. Another benefit of a recognized marriage is the potential for an increased exemption on estate taxes. The current estate tax exemption is set at $5.43 million. However, one spouse may claim the other's unused exemption amount and add it to their own, potentially saving millions later.
Same-sex couples should make certain they have complete estate plans in place. In addition to a will, they may want to have a power of attorney, a health care directive and a trust, depending on their estate's complexity. If a couple is preparing to marry, it's important to make certain that these documents are updated to reflect the change in filing status.
Estate planning is not static. Individuals should review estate planning documents on a regular basis to make certain they are up to date and reflect the current state of the law. Couples who are preparing to marry may want to meet with an estate planning attorney for help with drafting documents that will offer better tax advantages.