Recent legal victories within the LGBT community have certainly provided reason to celebrate; however, until absolute legal equality exists comprehensive estate planning remains crucial. With that in mind, let’s see how a trust can help with LGBT estate planning.
After decades of fighting for equality, one of the most important LGBTQ battles was finally won in 2015. In the historic case of Obergefell v. Hodges, the Supreme Court of the United States finally declared that marriage was a fundamental right, requiring all states to allow same-sex couples to marry and recognize same-sex marriages from other states. The need for comprehensive and cohesive estate planning for LGBTQ couples, however, remains strong for several reasons. One of those is to ensure that your spouse/partner isn’t shut out of the decision-making process in the event of your incapacity or death if your family has not yet accepted your relationship. If they have not, a costly and divisive legal battle could occur, causing irreparable harm to everyone involved.
Using a Trust in Your Estate Plan
One powerful estate planning tool that can help prevent litigation in the event of your death or incapacity is a revocable living trust. As the Settlor of the trust, you create the trust and name yourself as the Trustee. You then name the person you would want to take over control of your assets in the event of your incapacity as the successor Trustee. Assets are then transferred into the trust. As the Trustee, you continue to have access to, and control over, those assets just as you did before you created the trust. If, however, you become incapacitated, your successor Trustee takes over as the Trustee automatically. As the Trustee of the trust, your chosen successor now has control of the trust assets without the need to involve a court or do anything else. Because it is a revocable trust, you can also move assets in and out of the trust as needed and to replace the successor Trustee with someone else if the need arises. In addition, as the Settlor of the trust, you can even use the trust terms to define “incapacity” or to set up procedures to be followed to determine under what conditions the successor Trustee should take over as Trustee.
A living trust can also help in the event of your death, particularly if it is important to you that your spouse/partner handle decisions involving the disposition of your body and/or your burial and service. With a trust, you have the ability once again to name your spouse/partner as the Trustee, meaning he/she will be responsible for administering the trust and managing trust assets. You can fund the trust now or use a life insurance policy to fund the trust by naming the trust as the beneficiary of the policy. Because you create the trust terms, you can use those terms to make your wishes clear regarding your funeral and burial. Of equal importance is the fact that as the Trustee of the trust, your spouse/partner will have the legal authority to plan and implement your burial and funeral, effectively shutting down any potential conflict over who has the authority to make decisions before it even gets started.
As you can see, a living trust offers several ways in which you can protect your wishes and provide your spouse/partner with the authority you want him/her to have.
If you have questions or concerns about LGBTQ estate planning, contact us at (916) 437-3500 to schedule your appointment today.