More and more American couples are opting not to get married these days. As for those who do get married, though, many are deciding to wait until they are much older to tie the knot. Also, divorced and widowed Americans are also choosing to forgo remarriage and cohabitating instead.
It is a reasonable idea to delay or forgo marriage, and every couple has its reasons for doing so, but unmarried couples should be aware of how this might affect their estate planning needs. For example, people who are legally married have the benefit of leaving the entirety of their estates to their spouses without triggering a penny in federal estate taxes. Meanwhile, the estates of unmarried individuals will trigger federal estate taxes when they exceed $5.43 million in value. Other estate planning benefits of being married include inheriting the Social Security benefits of a deceased spouse, and getting to participate in different types of victim’s compensation funds — like the Sept. 11 victim funds.
Some of the disadvantages of not being married can be circumvented through appropriate estate planning strategies. One strategy for individuals who own valuable real property or other kinds of assets is to create a Revocable Living Trust. This kind of trust allows heirs to skip the probate process after the estate planner has died. The Revocable Living Trust will then distribute its assets to whoever the estate planner chose. These trusts offer a lot of flexibility about who will manage the trust creator’s affairs in the event of death or incapacitation as well.
For unmarried New York partners with smaller estates, a well-planned will could be all that is needed to accomplish their estate planning goals. Ultimately, by speaking with an experienced estate planning attorney, New York residents can get a sense of what estate planning strategies are most appropriate for their needs.
Source: The Huffington Post, “Estate Planning for Unmarried Couples,” Sep. 10, 2015
