COHABITATING – SENIORS SHOULD PLAN FOR THE FUTURE

Michigan and most states prohibit common law marriages, there are a fair amount of unmarried seniors living together who can take steps to protect the rights of their partners.

If you have no spouse, your partner has no legal rights to your estate if you die without a Will or Trust that provides for them. It is not uncommon for those that have children from a prior marriage or relationship to provide the unmarried partner with certain assets or a certain portion of the estate or even the right to live in a property for a period of time (life estate) with the rest passing to the children.

If you want your partner to be able to act for you in financial matters if you become incapacitated, this should be not only addressed in the Trust but also in a financial Durable Power of Attorney. The same is true as it relates to health care decisions if you are unable to make your own decisions. The advantage of being unmarried is long term care costs come into play for your partner, none of your own assets are considered available. The down side of that is that while a spouse can receive a certain portion of a Medicaid applicants assets and income, where an unmarried partner has no such rights. What’s more, transfer of assets between you and your partner can make the transfer ineligible for Medicaid if the transfer is done within five years prior to application. Creating joint assets can cause other unintended tax complications.

To learn more please email Steve Malach at Smalach@lipsonneilson.com