Married? Not Necessarily in the Eyes of the State.
Unmarried couples and unrecognized marriages are not entitled to privileges enjoyed by legally married couples.
That is simply a fact. In your state, the act and legalization of “marriage” may be recognized conditionally. Define your relationship however you like, but if you are not married according to the laws of your state of residence, you are legally single; regardless of how committed your relationship or the length of time you and your partner have been “coupled”. This is not a discussion about which relationships should or should not have recognition and protection; but an educational article regarding the steps you must take in order to protect your family and assure that your partner is allowed to make decisions on your behalf.
There is a common misconception that the understandings and assumptions between long-term, committed couple will be recognized on a practical level. The reality is that legally married couples enjoy certain rights and privileges not extended to non-married couples, starting with the presumption that a spouse is next-of-kin. Without that legal presumption, here are three issues you ought to consider when making long term plans with your partner.
- Decision Making Authority In a medical emergency or long-term incapacity, most states have a statutory hierarchy to determine who should have decision-making authority in the absence of valid estate planning documents such as a Durable Power of Attorney (Financial and for Health Care) and an Advance Directive. If you are incapacitated by illness or injury, and cannot speak on your own behalf or manage your affairs, these documents speak for you. Your chosen agent, appointed in the document, is authorized to make those health care decisions and to manage your assets. Without these documents in place, state law will determine your “spokesperson”. In Kansas and Missouri, your decision maker will be as follows:
In Kansas: Spouse, Adult children, Parent(s); if none of those relations exists, the hierarchy jumps to “remote family” under the intestate succession law. If no family is available, a court may appoint a guardian and conservator on your behalf.
In Missouri: Spouse, Surviving Children (or their guardians), Parents, or Siblings. If those direct relations are unavailable, your state defined “next nearest living relative” will be assigned or someone who assumes financial responsibility for you.
- Inheritance Each state has a unique set of statutes that govern “intestate succession” or the inheritance of property if there is not a Will or Trust in effect. These statutes will determine what assets and property can be passed to family, what is eligible for debt payments, what family can inherit and the percentages to be received.
Many couples that do not fall under the legal classification of “married” assume that if one parent of the joint children should die, the other would automatically receive all property. Without a Will or a Trust, the separately owned property will pass as if the deceased parent was a single person. Wills, Trusts, and various forms of joint ownership or non-probate transfers can protect your wishes in this complicated situation.
- Taxation Legal spouses can give freely to each other without incurring any “taxable” gifts. For example, adding a new spouse to the deed of your separately owned home is not a taxable gift; it is a marital transfer. Adding your “better half” in the same scenario, who is not a recognized spouse, may classify as a taxable gift. Proper planning with a tax expert or attorney may avoid this potentially significant tax penalty.
Regardless of how you and your partner treat your relationship, it is important to understand how your state will acknowledge your relationship when it comes to matters of incapacity, inheritance and taxes. Work with an Estate Planning attorney and tax professional to make sure that your future plans are just that… yours.