There are no shortcuts for estate planning, despite many people assuming there are several. For example, some simply add another person’s name to their account instead of creating a power of attorney. If the primary account holder becomes incapacitated, the other person whose name is on the account can access it. Although this can lead to several challenges later, the essential element is that it requires relinquishing ownership.
Additionally, when a married couple has a joint account, they usually have “Joint with Rights of Survivorship (JWROS). If one spouse passes away, the other spouse assumes ownership. With that said domestic partnerships do have this option. We will go over why domestic partnerships should still have an estate plan in a moment, but domestic partnerships do have similar rights to married couples. Because they are different, realizing that this type of relationship can impact your estate plan is critical. Estate planning is fundamental if you want to protect yourself and your spouse from unexpected circumstances. This blog is meant to highlight the intricacies of a domestic partnership and its implications on estate planning.
What Is a Domestic Partnership?
Domestic partnerships are legally recognized relationships between two people who live together, share a common domestic life, but are not married. These agreements can address various aspects regarding property ownership and decision-making authority. A domestic partnership agreement (DPA) can identify which assets are owned individually and jointly. Attorneys create these because clarity is essential, especially regarding the eventual distribution of assets if one partner passes away.
How Domestic Partnerships Impact Estate Planning
When there is no valid will or other estate planning documents, intestacy laws dictate how assets will be distributed. These may not favor the domestic partner, which could leave them in a vulnerable position. A well-drafted domestic partnership combined with a will or a trust can counteract this. This ensures that assets will go to designated beneficiaries and not based on generic laws. These documents can also avoid potential disputes among family members or heirs. Couples in domestic partnerships can use estate planning tools for assets, financial support, and healthcare decisions.
Remember that the title is more important than what is contained in your will. When you meet with your attorney to draft a DPA or a will, ask them how to title your assets. If you leave X to someone in your will, but it is titled in someone else’s name, the will is not going to strip that person’s ownership rights.
Protect Your Future with Luis E. Barreto & Associates
If you are in a domestic partnership or considering entering into one, don’t leave your future to chance. Ensure that your DPA and estate plan reflect your wishes and provide your partner the protection they deserve. Contact Luis E. Barreto & Associates today to schedule your free initial consultation. Together, we will navigate estate planning challenges while tailoring them to your needs and situation.
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