Members of the LGBT community tend to save more money for retirement than the population as a whole. But LGBT seniors planning for retirement also face unique concerns.
According to experts, people in the LGBT community tend to be higher earners, and have smaller families, some with no children. While lower family expenses may make it easier to plan for retirement, LGBT couples without children may also have to plan for additional caregiver costs as they approach retirement age.
Although same-sex couples may now marry in New York, the federal government does not yet recognize those marriages, and this creates complications for LGBT couples in terms of tax and estate planning.
As one example, estate taxes in 2013 will revert to a $1 million exclusion. When a heterosexual spouse passes away, his or her assets over $1 million can usually pass to the surviving spouse without being subject to the tax, but this federal right does not apply to LGBT couples, married or not.
Social Security is another concern for LGBT couples, as spousal benefits are not provided to same-sex partners. In addition, federal pension plans do not provide for spousal benefits. LGBT couples must also be careful when moving property into joint ownership, as this can result in a large gift tax.
With careful estate planning, there are solutions to many of these issues. LGBT couples planning for retirement would be advised to seek the counsel of a qualified estate planning attorney familiar with the unique needs of the LGBT community.
For more information about our estate planning and elder law services, visit www.elderlawnewyork.com.