By Trusts and Estates Attorney Kerri Castellini
June 26, 2016, marked the one year anniversary of Obergefell v. Hodges, 576 U.S.____(2015), the landmark case that legalized marriage between same sex couples throughout the United States. The effects of the case have had an impact on many areas of the law, but arguably, a significant impact on estate planning.
For the first time in all states, same sex spouses could plan for the future and the future of their families by fully utilizing the advantages and rights afforded opposite sex married couples.
Although the petitioners of the case included fourteen (14) same sex couples, the most well-known petitioner is John Obergefell. John Obergefell and John Arthur had an almost two decades old committed relationship.
When John Arthur fell terminally ill, the couple traveled from their home state of Ohio to Maryland to be legally married. John Arthur was so ill, that the couple was married inside the transport plane on the tarmac. After John Arthur’s death, Ohio did not recognize John Obergefell as his spouse, but rather treated him as a stranger in the eyes of the law.
Justice Anthony Kennedy wrote the majority opinion, and was joined by Justices Ruth Bader Ginsburg, Elena Kagan, Sonia Sotomayor, and Stephen Breyer. The opinion was hinged on the due process clause of the Fourteenth Amendment.
Although John Obergefell and John Arthur’s story is heart wrenching, it is neither a new nor a novel tale. For states that did not recognize same sex marriages, same sex surviving spouses did not enjoy the same rights and elections as other married couples. For example, many states provide certain statutory inheritance rights or right to elections.
For many same sex couples, the surviving spouse’s treatment at the death of the first spouse was dependent on the laws of the state of residency at death. With Obergefell, the Supreme Court legalized same sex marriage in all states.
Prior to Obergefell, same sex couples resorted to creative estate planning techniques to provide for their surviving partner. Although these techniques, such as adopting their partner, were a patch to the laws, they often fell short of the full range of options available to heterosexual couples. Now, all families can estate plan with the equal rights and the availability the full scope of planning techniques.
In addition to full spousal statutory rights, the ruling offered married couples the same state income, gift, and estate tax benefits as other married couples. For example, spouses could now take advantage of the marital deduction for states that have their own estate tax, and which previously did not recognize same sex marriages.
Although Obergefell made estate planning easier, it has not remedied all issues that may arise and states are still grappling with the application of the case to their state inheritance laws.
Same sex couples may still have issues that are unique to their family dynamic, such as adoption and children born through assisted reproductive technology. In addition, couples’ prior legal status, titling of property, and beneficiary designations should be reviewed carefully and updated in light of the current law.
ii. ID at 5