The U.S. Supreme Court has scheduled the dates for oral arguments in two landmark cases concerning same-sex marriage. As I discussed in my December 26th blog, these cases might have lasting impact on estate planning for same-sex couples.
The constitutionality of California’s Proposition 8 will be examined in Hollingsworth v. Perry. The Court will hear oral argument in the case on March 26th.
The constitutionality of the Defense of Marriage Act (“DOMA”) will be examined by the Court in U.S. v. Windsor. Windsor involves a fact pattern which would be familiar to estate planners because it involves the availability of the estate tax marital deduction. The couple in Windsor had been married under the laws of Canada and lived in New York. At the time of the death, New York law recognized same-sex marriages performed in other jurisdictions. The decedent had left the assets to her surviving spouse in a manner that would have qualified for the marital deduction. Therefore, but for DOMA, the estate would have been entitled to a marital deduction. However, the marital deduction was denied in that case. The Court has scheduled oral argument in the case for March 27th. (I was recently quoted in Estate Tax and Same-Sex Marriage, BNA Daily Tax Reports January 4, 2013, p. J-1, concerning the implications of Windsor.)
Today, estate planning for same-sex married partners is much the same as for unmarried partners, with a twist and a few extra layers. Depending on the holding in these cases, the planning might change considerably, both from a tax and a non-tax perspective.
Broadly, there are three possible avenues the Court could take in deciding these cases
- The Court could hold that California’s Proposition 8 and DOMA are both unconstitutional because of a fundamental right to marry whom you choose. If the Court is going to go this route, one might wonder why it is taking both these cases, when Windsor alone would have been sufficient to do so.
- The Court could hold that California’s Proposition 8 is unconstitutional because it removed a right which the California Supreme Court had granted and that DOMA is unconstitutional because the federal government cannot discriminate among married couples. However, the Court could determine that other states need not allow same-sex marriages nor respect those performed elsewhere.
- The Court could uphold both Proposition 8 and DOMA.
Of course, the Court could surprise everyone with something completely different, too! We will have to wait and see. The Court is expected to hand down its opinions in these cases this summer.
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (800) 846-1555
Latest posts by Steve Hartnett (see all)
- Nongrantor Trusts Can Be Very Useful in Certain Situations - December 11, 2018
- Grantor Trusts Provide Flexibility and Ease - December 4, 2018
- Proposed Regulations Address “Clawback” Issue - November 27, 2018