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When it comes to domestic partnerships in California, there is a unique standard of treatment since they are legally recognized, yet are still different from marriages. California has community property laws in place, meaning same sex couples can receive the same rights and responsibilities for estate planning purposes as any other marriage.
However, the legalities of estate planning and trusts can become complicated, leaving couples in high need of skilled attorneys to make sure they maximize their benefits. Here are certain areas that often require the most attention.
Will
A will may be a simple document, but the context within one goes a long way. Some of the main functions of a will are to determine the person who will inherit your assets, take over guardianship of your children, oversee any assets you leave for your children until they are adults and will be an executor. People who do not make a will before death become intestate. In California, this typically means your assets will go to your closest relatives rather than your partner.
Probate avoidance
In court, probate is the process of allocating the person's total sum of assets. It can often be a long and expensive process. There are various planning tools to avoid having to go through the probate process, since it can ultimately have more of a negative outcome than a positive one.
Financial powers of attorney
Naming someone as your power of attorney means you are giving him or her the power over your finances. A limited power of attorney is for a certain amount of time and a durable power of attorney is in the event you will not be able to take care of your finances on your own. There can be comfort in making sure your partner will be your power of attorney in order to manage your finances, in case of unfortunate events down the road.
Health care directives and final arrangements
A health care directive is choosing what to do when you are at the end of your life. The living will or declaration is you specifically saying what you do and do not want for yourself when it comes to care. The power of attorney for health care names a person to make the decision for you if you are unable. Confirming a health care directive sets plans in stone and allows you to be treated how you desire during your final time.
Having a final arrangements document determines the details of what you want for your final arrangements in life. It can highlight type of care payments, ceremonies, cremation, burial and anything else relating to after-life decisions.
Income taxes
Although the IRS does not recognize same-sex couples for federal income tax purposes, there have been successful challenges to overcome it. In order to attempt to do this, different aspects, such as single settler trust management or joint trust management need to be considered.
Estate taxes
Estate taxes can usually be avoided, but it is a more difficult process for same sex marriages. Our legal team can help decipher whether estate taxes will be an issue for you and how to reduce them if they are.
Ultimately, there are a lot of contradictions in the existing law of estate planning and trusts for same sex couples. The possibilities to receive the same benefits as anyone else exist for same sex couples; it's just a matter of having an attorney who will do the work to find them.