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Non-traditional couples must act to protect their wishes
April 15, 2012
Estate planning is a challenge for most of us to navigate.
Sorting through wills, trusts, titles and powers of attorney can be a daunting and tedious task. Those that don't fit the traditional view of marriage -- same-sex partners and other domestic partners -- encounter an even higher degree of complexity. Unlike with traditional marriages, the default state laws may not give your partner the rights and property you intend them to have in case of your death or disability.
For example, could your partner visit you in hospital and make medical decisions for you if you were hurt in an accident and unable to communicate your own wishes? These rights are not granted by default.
Few dispute that a traditional spouse would be permitted them if you were incapacitated even without the proper legal documents in place. A partner could more easily be denied these privileges.
And under current federal HIPAA privacy laws, health care providers can use professional judgment whether it's in the best interest of the patient for information to be shared. Their judgment may not include a partner with little legal standing.
Colorado law places cohabitating partners behind children and parents in line to make medical decisions for you --unless you take legal steps to secure this right.
Through a health care power of attorney that includes visitation rights and a HIPAA release, this can be accomplished. Naming your partner as a designated beneficiary in Colorado also gives your partner access to medical information and the ability to make decisions, according to Denver-based attorney Erica Johnson, who specializes in estate planning for non-traditional couples.
While dying without a will can be a legal quagmire for anyone, the surviving partner of a non-traditional couple could find it a nightmare. If you die without a will, Colorado has a plan for your estate known as the intestacy laws. Without a traditional spouse or the correct legal documents in place, your assets may pass to your children, grandchildren, parents, siblings and even nieces and nephews before your partner is considered.
If you are committed to your partner and want him or her to receive part of your estate, you must take legal steps to guarantee that right. Beneficiary statements on retirement plans, IRAs, life insurance policies, individual investment accounts and annuities should specify the correct inheritors. Assets such as houses should be titled in such a way to ensure they pass to the right people.
A will is the most common way to leave your assets according to your wishes. Revocable trusts, also known as living trusts, can be put in place to provide for your partner. Naming your partner as a designated beneficiary under Colorado law can give them important property rights upon your death.
What if you've gone to the trouble and expense of meeting with an attorney to get your legal house in order and then you "divorce" your partner?
With married couples, upon divorce, your ex-spouse is written out of your will. Powers over your health care and finances are revoked. With non-traditional couples, there was never a marriage, so there's not a divorce with all of its protections. If you have spent 20 years together building up your wealth, members of separating non-traditional couples will find they each have much fewer rights than if they were divorcing a traditional spouse.
If you are in a committed, non-traditional relationship, you must seek assistance from a qualified estate planning attorney that has experience and preferably specializes in non-traditional couples.
For non-traditional couples, procrastination most likely means that your wishes will not be followed upon your death or incapacity.
Dave Gardner is a certified financial planner with a practice in Boulder. He can be reached through his website at yellowstonefinancial.com
Boulder Daily Camera