At the federal level, the law is quite clear: LGBT couples are strangers in the eyes of the law. The passage of the Defense of Marriage Act in 1996 codified this view. DOMA does two main things. First, it defines the term “marriage” for the purposes of federal law as a legal union between one man and one woman, as husband and wife. Second, the law allows states to deny marriage-type relationships for LGBT couples even though the relationship may be recognized in other states. The financial and legal impact of the inability to marry is significant. There are 1,138 identified federal statutes in which marital status is a factor in receiving federal benefits, rights and privileges. As such, LGBT individuals, couples and their families have particular incentive to plan their estates deliberately. Without enforceable, written legal plans in place, the personal and financial affairs of LGBT individuals are subject to legal default rules. The legal default rules favor relationships based upon marital or biological ties and do not recognize LGBT relationships. While it is absolutely advisable for married people or those with children to work with a wills and trusts lawyer, it is just as important for single adults. If you were to suddenly become incapacitated, who would make your medical decisions for you? Who would continue to pay your mortgage or file your taxes? If you haven’t worked with an estate-planning attorney, the answer to this question becomes quite complicated. Possibly your parents would be called in to determine how your medical care should proceed. However, if hostilities among family exists, planning ahead ensures your wishes are followed. Even if your parent or sibling would be your first choice, that doesn’t mean the courts would agree without having your express wishes legally documented. Without clearly outlining your goals with an estate-planning attorney, you have very little control over the matter. A single adult without children may not need to worry about creating guardianships for his or her offspring, but it’s certainly a good idea to look out for yourself and perhaps leave a philanthropic legacy behind. What happens, for example, to the financial assets of an unmarried person who dies without a will? Under the Commonwealth of Pennsylvania law, the assets held in the sole and separate name of an unmarried person who has no written plan in place will pass through the public proceedings known as “probate” and will pass in the following order:
• descendants (that is, children or grandchildren) • parents • descendants of your parents (siblings, nieces, nephews and so on) • lineal descendants of maternal and paternal grandparents (that is, uncles, aunts and cousins) • Commonwealth of Pennsylvania Some questions to consider when planning your estate: • Who should help me manage my affairs in the event of short-term or long-term incapacity? • Who should make medical decisions for me if I cannot speak for myself? • What will happen to my property? • If I am in a relationship, how should my partner and I organize our financial affairs? • How can I leave a legacy for my community?
At a minimum, I recommend the following documents for my LGBT clients: • Powers of Attorney: A health-care power of attorney is critically important if you want your partner to act for you should you become incapacitated. You also need a durable power of attorney. This gives someone power over your affairs, such as businesses, finances and real estate. • Advanced Directive: A “living will” enables you to provide instructions to physicians relating to prolonged life support in the event of incurable illness. • HIPAA Authorization: In the past few years, the law has changed to guarantee a higher right to privacy regarding patient health information. Under the Health Insurance Portability and Accountability Act of 1996, specific authorization is now required to permit medical personnel to release “protected health-care information.” If you do not have this authorization, it could potentially create a problem in the event a physician needs to release medical information in order to activate health-care powers of attorney. • Hospital Visitation Authorization Form: This short document allows you to visit your partner in any medical or treatment facility, and depending on the couples’ wishes, it can also grant you the power to dictate who is allowed in the hospital room to visit your partner. • Pet-Care Directive: These directives became much more popular after Hurricane Katrina. It is a document that provides for who will take care of your pet should anything happen to you. Moreover, it lists what veterinary practice the pet attends and can leave sums of money in order for your agent to properly care for your pet. • Cohabitation Agreement: If you and your spouse or domestic partner live together and share assets, a cohabitation agreement is critical. This agreement is a cross between a prenuptial agreement and a partnership agreement. Not only can the contract dictate how money and expenses will be managed and divided, but it also defines the duties and responsibilities of each party and may reduce taxable gifts. • Will: Without a will you are subject to the intestacy laws of your state. These laws adversely affect LGBT couples because they define “heirs at law” as blood relatives or adopted children. Without a will, your domestic partner may not be entitled to any of your assets, even assets you may jointly own.
You cannot “opt out” of estate planning. Whether you know it or not, you have an estate plan right now. Without a will, the Commonwealth of Pennsylvania law “writes” your estate plan for you. This means the Commonwealth, which does not recognize the existence of our relationships, decides who is in charge and who gets what through its intestacy laws. As such, it is imperative for all LGBT individuals, couples and families to empower themselves and protect their loved ones by obtaining these simple, yet powerful, legal documents.