To be certain, there are more than five things to consider before you decide to get married: Where are we going to live? Will we grow old together? Should we open a joint checking account? How will we file our income taxes? At which parent’s house will we spend the holidays? These are all are examples of what may come to mind.
Thankfully, gays and lesbians in the District and in Maryland now have the opportunity to consider entering a marital union that is recognized by their state of residence. In the District, the historic vote by the City Council in December 2009 allowed same-sex couples to obtain valid marriage licenses and get married effective March 3, 2010. In Maryland, Attorney General Douglas Gansler published an opinion on Feb. 23 opening the door for the recognition of same-sex marriages that are validly performed in other states.
Many gays and lesbians have never had to seriously concern ourselves with exchanging vows. Never having had a talk about marriage with a parent or other mentor may have left an information gap. Faced with the reality that we really can marry, many of us are not prepared for all that marriage offers, nor what it requires of us.
Simply put, you don’t know what you don’t know. The excitement of our newly gained right, the love, the romance, the feeling of freedom and justice may crowd out some very important questions to ask about marriage and about your soon-to-be spouse. Before you tie the knot, jump the broom, take the plunge or settle down, take time to consider and talk through the non-romantic aspects of marriage: finances, economics, and the law. Here are some considerations.
Marriage is not a cure-all to protect your partner and your relationship. Marriage is still not recognized by the federal government because of the Defense of Marriage Act. That means protections afforded to opposite sex married couples in the tax code, ERISA, Social Security, Medicare and Medicaid, the Family and Medical Leave Act, immigration laws and many other areas of the law are not available to same-sex married couples.
Many states like Virginia have draconian laws invalidating your marriage while you visit there. For example, if you and your spouse hike the Appalachian Trail and you get seriously injured near Roanoke, your spouse may not be allowed to visit you in the hospital.
Recognition of our marriages is a giant step forward in protecting our loved ones, but you should not stop at “I do” and assume your affairs are in order. You still need to put an estate plan in place, a health care power of attorney (including a HIPAA authorization and living will), a durable financial power of attorney, and a last will and testament — and for some, a revocable living trust.
Your spouse can now sue you for alimony if you get divorced. Not a pleasant thought to have as you walk down the aisle; however, the economics of marriage are important to understand. Historically, a spouse who is wealthier may get saddled with alimony payments to support the less wealthy spouse upon a separation or divorce. In addition, all the income earned by both spouses during the marriage, including wages, dividends and appreciation in investments, is considered marital property. A judge may decide how to divide your marital property at the time of a divorce regardless of who earned it or added the most equity to it.
The law looks at marriage as an economic partnership between the spouses. One may contribute money, while the other supplies sweat equity. Unless you agree otherwise before the nuptials, all the marital property is equitably divided upon dissolution. This problem can be addressed in a prenuptial agreement (a “prenup”). In some states you can make an agreement during the marriage, too.
A creditor of your spouse can take your assets. One common mistake couples make is to title assets in their names as joint tenants with rights of survivorship, but without considering the consequences. In some cases, titling an asset like a house or a checking account as joint tenants with rights of survivorship can be a good choice. For example, it can create a cohesive feeling of permanence and shared experience. It can also be a good tool to practice communication and navigate interdependence. But it comes with severe risk for the unwary.
If your spouse — or for that matter a non-spouse who is your joint tenant on an asset or account — has a judgment creditor, that creditor can come after the entire jointly owned asset — yes, even your share of it. While this may seem counterintuitive, property law determines that parties to a joint tenancy (with rights of survivorship) each own an undivided share in the whole asset. Therefore, the creditor of one of the joint tenants has a right to the entire asset.
There are other reasons to avoid joint tenancies, such as gift tax consequences and loss of control. The easiest way around this problem is to simply avoid co-mingling assets and keep your possessions in your own name. Talk to your estate planning attorney about it. Know the benefits and risks prior to changing title.
You may become disqualified to receive certain public benefits by being married. Eligibility for public benefits like Medicaid is complex. Eligibility requirements vary from state to state and can be negatively affected by either (1) marriage because of family income levels; or (2) a wealthier spouse leaving an inheritance to a less wealthy spouse.
If the couple has minor children who are dependent on public health care, it is imperative that the couple carefully weigh how marriage will impact their ability to qualify for public benefits, or to qualify in the future. In other words, do not make a quick emotional decision. Instead, get reliable advice before applying for the marriage license.
“You can’t disinherit your spouse” or “Divorce is not cheap and easy.” Marriage is an officially authorized union with a long and rich legal history. Part of that history includes laws that require that you take care of your spouse. You cannot leave them with nothing.
Consider this scenario: Chris and Kim, residents of Maryland, just got married in D.C. They are economically independent and each has their own assets. They have no children. Eight months into the marriage, Chris and Kim begin to drift apart after an argument. Kim moves out less than a year after their nuptials. Both move on with their lives, but they never officially end the marriage. Upon Kim’s death, 10 years later, Chris claims one-half of Kim’s estate.
Even if you have an estate plan in place, your spouse (or your spouse’s representatives) may un-do your plan. Generally speaking, a surviving spouse is entitled to anywhere from one-third to one-half of the deceased spouse’s property at death. In addition, a surviving spouse may have certain allowances for property against the estate. The only way to make certain that the goals of your estate plan are accomplished is by executing a prenuptial (or marital) agreement with your spouse waiving your respective rights to your estates.
Just because you can does not mean that you should get married. Many of us fight and advocate fiercely for the right to get married. Now that our community enjoys that right in some places, we must carefully consider if it is the right decision for us individually. If it is, be well prepared so that you can reduce or eliminate the unintended consequences from the legal side of marriage.
J. Max Barger, an attorney and MBA, is Senior Council at Ackerman Legal where he leads the Estate Planning, Business Succession and Probate practice group. Max will be presenting “Five Things You Should Do Before You Say “I Do” at the Hillyer Museum and Art Space on Wednesday April 7 at 7 p.m. The seminar is sponsored by Merrill Lynch, GAYLAW and Ackerman Legal.