Who doesn’t love a good surprise? A party with all your loved ones. A book with a twist ending. A big tax refund!
But not all surprises are good. Some – cancer, disease, estrangement – can be shocking, painful, or potentially life-changing. LGBTQ+ people may face unexpected and emotional roadblocks in the middle of settling estates that can be mitigated through preparedness. By understanding the nuances of proactive planning, you can safeguard your assets, ensure your wishes are respected, and ensure your future aligns with your values and relationships.
Plan for Family Discord
Unfortunately, not everyone is accepting of their LGBTQ+ family members and their partners/spouses. New data out of the U.K. shows that nearly half of LGBTQ+ adults are estranged from family. For those in same-sex or queer relationships who feel enduring tension within their family, consider adding a no-contest clause to your will or revocable living trust. This clause states that a beneficiary will lose anything they were to inherit upon a person’s death should they try to contest or invalidate the will.
“KEVIN!”
Don’t forget the kids!!! Children of same-sex parents add a layer of complexity to estate planning. Even if you are married, one spouse might not be the legal parent of one or more of your children. Here are some initial steps when planning for children:
- Designate guardianship: In your will, you can name the legal guardian(s) for your minor children. Without it, the court decides guardianship on your behalf.
- Consider second-parent adoption: This is important, particularly if a breakup occurs. Laws in some states do not recognize the second parent of unmarried, same-sex couples as a legal parent. This is especially challenging for those who have children from prior relationships. Thus, the nonbiological parent has few, if any, legal rights with respect to the child without this second-parent, co-parent, or stepparent adoption.
- Make a parenting (custody) agreement: This is a written document that outlines how you and your spouse handle the care of your children after a potential divorce or breakup. It can include financial matters, visitation, education, and social schedules. This is a helpful document if you have committed to joint parenting but cannot – or choose not to – adopt.
If you are unmarried, the journey to building a family may be even more complicated if you live in a state that does not allow second-parent adoption. If you live in a state that prohibits second-parent adoption, you should speak with an LGBTQ+ family law or estate planning attorney. For a state-by-state overview of second-parent adoption laws and cases, visit the Lambda Legal Defense and Education Fund’s website.
Make Final Arrangements
This non-binding document allows you and your partner or spouse to provide as much additional detail as possible. Some items might include:
- Burial or cremation
- Caskets and urns
- Ceremonies
- Digital estate plan (photos, passwords, social media)
- Funeral costs
- Headstones or memorials
These details can provide relief and peace for those handling your end-of-life plans. This is especially valuable for your partner or spouse if you anticipate other people may cause friction or provide varying opinions about how you are laid to rest.
Build a Supportive Network
Throughout this journey, it is essential to surround yourself with a supportive network of professionals who understand the unique challenges faced by the LGBTQ+ community, especially as we age. This may include attorneys, financial advisors, accountants, and other experts who specialize in LGBTQ+ tax, financial, and estate planning. Other helpful resources for our community include:
Tax and estate planning for the LGBTQ+ community can be complex, regardless of whether you decide marriage is right for you. But with the right knowledge and guidance, you can navigate these challenges successfully. By staying informed, working with experienced professionals, and proactively planning for your future, you can protect your assets, safeguard your loved ones, and ensure your wishes are respected.
To help best plan for your and your family’s future, schedule a meeting with our advisors today.
