Same-sex marriage is now legal in PA - but what would taking the plunge mean for you?
LGBT Pride month just ended (and so have the parades taking place in cities across the country). The LGBT community had a lot to celebrate - the state’s ban on same sex marriage was ruled unconstitutional by the U.S. Federal District Court on May 20, adding Pennsylvania to the wave of states that have legalized same-sex marriage. In the aftermath of this decision, the laws surrounding same-sex marriage have changed substantially. The legalization of same-sex marriage does a lot more than save you a trip out of state to get hitched.
If you, or someone you know, is considering taking advantage of the new law and tying the knot, it is important to look at what that choice will mean for the financial future. To make a long-story short, same-sex couples are now entitled to all of the benefits other married couples receive. What this means is that a spouse in a same-sex marriage will now be automatically entitled to inherit from his/her partner. Without state recognition of a same-sex marriage, without a will, a spouse or partner would often be left out of the distribution of assets entirely, or at best would still not be given the full rights of a spouse under the law. State recognition also allows for a same-sex spouse to inherit without paying an estate tax. Previously, a same-sex spouse would be forced to pay the 15% tax rate for non-relatives, even if the couple were legally married in another state, but living in Pennsylvania.
The legalization of same-sex marriage in Pennsylvania also means couples can take advantage of benefits at the federal level including filing joint tax returns, social security benefits, employee benefits, IRA accounts, and avoidance of paying estate tax. Before the end of May, these benefits were only available to same-sex couples residing in Pennsylvania who were married in another state. Getting married is a major life change, but that change also effects your financial situation. Be prepared to navigate joint checking accounts, combined debt, and changing credit scores – with open communication and good planning, the financial changes of being married are easily managed.
If you would like to discuss estate planning options for same-sex marriage in Montgomery, Philadelphia, or Delaware Counties, please contact us.