Annapolis Estate Planning for Domestic Partnerships Attorneys

If you are involved in a committed relationship or domestic partnership, there are additional estate planning issues to consider. At the Law Offices of Merrill, Cruttenden & Collinson, P.A., we are proud to help couples facing these questions. We will take the time to talk with you and understand your situation so that we can develop a comprehensive plan that meets your needs and goals.

Maryland Inheritance Tax implications

Recently, Maryland enacted the Marriage Equality Act to become effective January 1, 2013. Provided that the law survives and referendum, domestic couples married and living in Maryland will enjoy all of the same rights and privileges afforded to heterosexual married couples. However, should the new law be lost to a referendum and the status quo returned, there will be several considerations that domestic partners need to keep in mind when thinking about an estate plan.

First, the Maryland inheritance tax would subject a 10 percent tax for surviving domestic partners who receive property as set forth in a Will. There is an exception from this 10 percent tax for jointly owned real estate, but right now that exception is only available after completing an Affidavit of Domestic Partnership and attaching two pieces of additional evidence (i.e., joint bank account, joint property deed, joint deed of trust, etc.) to help establish or show that there was indeed a domestic partnership relationship.

When considering an estate plan, we often talk with our clients involved in a domestic partnership about using nontaxable property transfers — including life insurance — to provide for the surviving partner. In certain cases it may be more beneficial to have a surviving partner named as a beneficiary in a life insurance policy and then to dispose of the taxable property to other individuals who may not be subject to the inheritance tax.

We also work with domestic partners to develop tax strategies and develop tools as part of the estate planning process. In some cases, these tax tools are not available to married couples.

Additional Opportunities and Considerations

An important area of discussion for domestic partners either as part of an overall estate plan or as stand-alone documentation is planning for incapacity. It is critical that your powers of attorney documents and medical directives are up to date and accurately reflect your relationship and desire to designate a person to make decisions on your behalf.

These documents should expressly allow your domestic partner access to your medical records and provide him or her with the authority to make decisions about you in case you become ill or lack the capacity to make your own decisions.

In situations involving children, custody may be an issue to address in your estate plan. Depending on your family, it may be necessary to draft guardianship or standby guardian documents to ensure that minor children are cared for in case of an emergency or death of a parent.

Contact Annapolis Inheritance Tax Attorneys at Merrill, Cruttenden & Collinson, P.A.

If you are facing probate or trust administration issues, we can answer your questions and help you seek favorable results. Please contact our Maryland estate planning law firm or call our office at 410-881-0355 to speak with an experienced lawyer. We offer our estate planning and business law clients free initial consultations.