Landmark Supreme Court Marriage Case May Affect Planning Choices

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Gay marriage is currently legal in 36 states, mostly because of the decision in the 2013 case of Windsor v. United States, in which the U.S. Supreme Court invalidated the federal Defense of Marriage Act. Two years later, the issue is back in the Supreme Court. And, by the end of this Supreme Court term, either same-sex couples will be able to wed in all 50 states, or gay marriage bans may be reinstituted in many of the states where they’ve previously been struck down.

The current Supreme Court case, Obergefell v. Hodges, deals with two questions: whether all states must issue marriage licenses to same-sex couples and, if they don’t, whether they must recognize those issued by other states.

The plaintiff, Jim Obergefell, and his partner of 20 years, John Arthur, were married after Arthur was terminally ill with Amyotrophic Lateral Sclerosis (ALS). To wed, Arthur flew via medical transport plane from Ohio to Maryland, where gay marriage is legal, as part of a “Make-a-Wish” style program for the terminally ill.

The couple wanted the Ohio Registrar to identify Obergefell as Arthur’s spouse on his death certificate, based on their Maryland marriage. The local Ohio Registrar agreed that discriminating against the same-sex married couple is unconstitutional, but the state Attorney General’s office announced plans to defend Ohio’s same-sex marriage ban. A federal judge, acting on an expedited basis because of John’s health, ordered the state of Ohio to record Jim as the surviving spouse when the time came.

Three months and 11 days later, John Arthur died, and Obergefell’s name was listed as the surviving spouse on the death certificate. The state appealed, and if it wins in the  Supreme Court, it can reissue the death certificate without Obergefell’s name.

On January 16, 2015, the Supreme Court consolidated Obergefell’s case with three others and agreed to review the case. It set a briefing schedule to be completed April 17. The other cases are from Michigan, Kentucky, and Tennessee. The court presented the following questions:

  1. Does the Fourteenth Amendment require a state to license a marriage between two people of the same sex?
  2. Does the Fourteenth Amendment require a state to recognize a marriage between two people of the same sex when their marriage was lawfully licensed and performed out-of-state?

Oral arguments are scheduled for today, April 28. Gay rights groups are hoping to secure not only the right to marry but also a symbolic and practical victory that would affirm their dignity and protect them from other kinds of government discrimination. A decision in the case is expected by the end of June.

What Benefits Do Same-Sex Married Couples Qualify for Now?

At this point in time, with same-sex marriage being legal in 36 states, LGBT married couples qualify for the following benefits:

  • Social Security benefits: Married couples get a big financial boost from certain Social Security benefit programs that have not historically applied to LGBT couples.
  • Spousal survivor benefit: A surviving spouse of a worker entitled to Social Security retirement or disability benefits may be entitled to receive retirement benefits based on the deceased spouse’s earning record.
  • Spousal retirement benefit: For retired married couples, a person whose calculated Social Security benefit is lower than that of his or her spouse may take half of his or her spouse’s higher benefit, rather than receive the amount calculated from his or her own earnings.
  • Lump-sum death benefit: A surviving spouse gets $255 from the federal government to help pay for funeral arrangements.
  • Estate and gift tax exemption: Federal law exempts a certain amount of money from federal estate taxes and federal gift taxes for all property left to a surviving spouse (currently the exemption is $5,430,000). The surviving spouse does not pay taxes on any amount he or she receives from the deceased spouse that’s under the exemption limit.
  • Estate Tax “Portability:” Married couples can combine their personal estate tax exemptions. This means that the second spouse to die can leave property worth up to $10,860,000 free from federal estate tax. Unmarried couples do not get the “portability,” so that the second partner in a relationship to die can leave only $5,430,000 tax-free.
  • Veteran and Military Benefits: Spouses of deceased veterans are entitled to numerous benefits, including health care, death pensions, educational assistance, home loan guarantees, vocational training, and bereavement counseling. Spouses of living military personnel may be eligible for health care, family separation pay, and relocation assistance, among many other benefits. Same-sex married spouses should also be entitled to these services and benefits.
  • Tax Benefits: Filing joint income tax returns with the IRS: Filing a joint return may offer advantages over separate returns. Many unmarried couples lose thousands of dollars per year because they have to file separate tax returns with the IRS.
  • Federal Employee Benefits: Last summer, the Office of Personnel Management announced that federal employees in LGBT marriages could apply for health, dental, long-term care, life and retirement benefits.
  • Medicare: The Department of Health and Human Services said that legally married LGBT seniors on Medicare would be eligible for equal benefits and joint placement in nursing homes.
  • Immigration: The Department of Homeland Security will treat LGBT spouses equally for the purposes of obtaining a green card if the spouse is a foreign national. And the IRS has begun treating same-sex marriages equally for tax-filing purposes.

Regardless of the outcome of the case, planning is of utmost importance

If a member of the LGBT community fails to properly plan, the result can be devastating to his or her partner and family. Having no estate plan is tantamount to giving up control of one’s estate and management of one’s well-being in times of incapacity.

The need for an estate plan is critical in case of an accident or illness that renders the partner incapable of making decisions or managing his or her affairs. Without a proper estate plan, the other partner could be legally precluded from having any role in the decision-making of his or her partner’s care, managing his or her affairs, or even having access to the incapacitated partner.

Proper estate planning ensures that correct strategies are used to avoid penalties, extra taxation when possible, and the court and attorney costs of probate. A Revocable Living Trust can establish the client’s domestic partner as the trustee if the client becomes incapacitated through illness or accident. The Revocable Living Trust guarantees privacy, through avoidance of probate and its process of opening court records. The Advance Medical Directive can also avoid the potential problems of the client not maintaining control over his or her health care decisions and the domestic partner not having access to his or her partner during a period of incapacitation.

While laws are changing to promote greater equality for LGBT seniors, whether you are gay or straight, if you haven’t done so, now is the time to get started with planning for your future and for your loved ones! We here at the Law Firm of Evan H. Farr, P.C. have strategies in place to help LGBT couples, whether married or not. With advance planning, each person, regardless of sexual orientation, can retain the benefit of the money, income and assets it has taken a lifetime to accumulate. If you or your loved ones have not done Long-Term Care Planning, Estate Planning, or Incapacity Planning (or had your Planning documents reviewed in the past several years), please call us as soon as possible to make an appointment for a consultation:

Fairfax Elder Law: 703-691-1888
Fredericksburg Elder Law: 540-479-1435
Rockville Elder Law: 301-519-8041
DC Elder Law: 202-587-2797

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About Evan H Farr, CELA, CAP

Evan H. Farr is a 4-time Best-Selling author in the field of Elder Law and Estate Planning. In addition to being one of approximately 500 Certified Elder Law Attorneys in the Country, Evan is one of approximately 100 members of the Council of Advanced Practitioners of the National Academy of Elder Law Attorneys and is a Charter Member of the Academy of Special Needs Planners.