For Better or Worse: Estate Planning for Same-Sex Spouses

As a recent article explains, the United States Supreme Court’s recent ruling on same-sex marriage will radically alter estate planning for same-sex married couples.

Prior to the decision, thousands of federal laws available to married couples were not available to same-sex married couples due to the Federal Defense of Marriage Act (“DOMA”), which defined marriage as between a man and a woman. By striking down DOMA, the United States Supreme Court suddenly made thousands of federal estate planning tools available to same-sex married couples.

One of these tools is portability. Portability allows a surviving spouse to utilize the unused portion of his or her deceased spouse’s estate tax exclusion. Portability was made permanent in the new 2012 tax law. In order to use the unused portion of your spouse’s estate tax exemption, the surviving spouse needs to have the executor of the deceased spouse’s estate transfer the unused exclusion, as this is not automatic.