Estate Planning Essentials for Gay and Lesbian Couples

Estate planning for gay and lesbian couples, especially those living in the 36 states that don’t recognize same-sex relationships, is tricky but essential. It’s the best way for homosexual couples to ensure their health care wishes are honored and their assets upon death are distributed as desired.
 
Start by making sure that each partner is listed as the beneficiary for the other's IRAs, 401(k) plans and life insurance policies. Then begin work on these basic documents. I strongly recommend hiring a estate lawyer who has experience working with lesbian and gay clients to help draft most of these legal papers:

Basic Estate Planning Documents
 
A will: If you and your partner don’t have wills, your state will determine who will inherit each of your estates. In most states, the partner of the deceased spouse gets nothing if there’s no will.
 
Talk with your lawyer about whether a trust would be helpful. (Even if you have a trust, however, you still need a will.)
 
A few specific tips, if you have one or more children: Name a guardian in the will to ensure the person of your choice will take care of your child or children, if necessary. Also, if state law allows, enter into a second-parent or joint adoption arrangement. If not, have your lawyer draft a joint custody agreement and then file it in court. This document will support the position that the two of you are parenting the child, which will also prove helpful if the relationship ends.
 
(MORE: 5 Steps to Creating Your Digital Estate Plan)
 
A domestic partnership agreement: Comparable to a prenuptial agreement, this contract is a useful way to address how you plan to share your income, expenses and property. In this agreement, you can specify which property you hold jointly and which is separate. This agreement, available free on sites like Rocket Lawyer, comes in handy if the relationship ends.
 
HIPAA authorization: The Health Insurance Portability and Accountability Act allows you to authorize medical providers to discuss your condition and prognosis with your partner. Without it, doctors may claim that they can speak only with "immediate family" — and in most states, your partner is not considered “immediate family.”
 
Avoid this problem by filling out the HIPAA form. You can get one from your doctor or here.
 
A living will and health care power of attorney: These documents allow your partner to carry out your wishes concerning your medical care.

Perhaps surprisingly, only about 30 percent of Americans have a living will. (Some experts, however, think a living will may not be clear enough to fully guide loved ones, as noted in a recent Next Avenue article.)

You can download state-specific forms for a living will and health care power of attorney from organizations like Caring Connections, a national consumer initiative to improve end-of-life care.
 
It’s a good idea to include a mediation or arbitration clause in these forms. That way, you and your partner can resolve disputes without resorting to expensive litigation.
 
General durable power of attorney: This document lets your partner manage your financial affairs if you become disabled. Although you can get a form online, it’s better to have a lawyer draft one specifically for your circumstances.