On June 26, 2015, in a 5-4 decision in Obergefell v. Hodges, the U.S. Supreme Court held that there is a fundamental Constitutional right to marry which includes same-sex couples. The Court also held that same-sex marriages performed in one state must be recognized by every other state. Justice Kennedy, writing for the majority, started the opinion “The Constitution promises liberty to all within its reach, a liberty that includes certain specific rights that allow persons, within a lawful realm, to define and express their identity. The Petitioners in these cases seek to find that liberty by marrying someone of the same sex . . . .” Justice Kennedy concludes the opinion, “They ask for equal dignity in the eyes of the law. The Constitution grants them that right.”

So, now it is clear that same-sex marriages are legal nationwide and, wherever they are performed, they must be respected in every state.

But, what does this mean for our clients?

If clients want to get married, they can, regardless of their sexual orientation or their state or residence.  But, the decision to get married is a personal one.  Here are some considerations:

1. There are religious and societal implications to marriage. The couple may be deemed to have greater respect and greater “glue” in the relationship.  They couple may be viewed as more “traditional,” even if a same-sex couple.
2. Conversely, if the couple desires to part ways once married, it is more difficult and a divorce may be costly.
3. A married couple typically has a lower tax burden than an unmarried couple with the same income. However, if the income of each spouse is about the same, there may be a marriage “penalty” instead of the typical marriage “bonus.”
4. Married couples can leave an unlimited amount to each other without facing an estate tax. Married couples also can give each other unlimited amounts of money without facing a gift tax, assuming they are both U.S. citizens.
5. Social Security benefits are a valuable resource. A low-earning spouse may be able to get more benefits by drawing on the higher-earning spouse’s account.  Also, a surviving spouse can get Social Security survivor benefits which can be quite valuable.
6. In many states, the property tax basis may be passed to a surviving spouse, while it may not be passed to someone else.
7. Employers may provide health insurance or other benefits to a spouse.
8. Married couples may find it easier to adopt children.
9. Spouses cannot be forced to testify against their spouse in court.
10. The earned income of each spouse in a community property state will be owned by ½ each spouse.

The decision to marry is a deeply personal one.  The financial incentives typically favor getting married by a wide margin.  However, money is not everything.  Educate your clients regarding the legal consequences of marriage.  Clients, particularly those in the LGBT community, may be unfamiliar with the advantages and disadvantages of marriage.

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
www.aaepa.com

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Steve Hartnett

Director of Education, American Academy of Estate Planning Attorneys

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