DOMA Overturned, What Now?

Jun 30, 2013 | by Franck Cushner, CFP®

As I write this I am looking out of my window in Greenwich Village watching throngs of proud citizens celebrate Pride and the overturning of DOMA.  One of our clients recently called to inform us of his engagement and very soon to be nuptials.  Unfortunately, we had to tell him to WAIT!

There are many financial factors to be taken into account now more than ever before same sex couples say “I do.”  In the case of financial hardship, if one partner has significant debt and is contemplating bankruptcy, then consider the implications.  A faculty working paper from the Vermont Law School mentions :

The application of the federal definitions provision has a significant effect on the rights of creditors, debtors and their same-sex partners. It has the potential to influence every aspect of the bankruptcy from the composition of the estate, to the calculation of the means test, to exemptions under state and federal law, to the ability to discharge particular debts.

The entire paper can be viewed here http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1850926

Keep in mind this paper was written prior to the U.S. Supreme Court decision.

 

Other factors to be considered are taxes, estate and financial planning, and legal issues.  My head is already swimming thinking of these situations! 

Congratulations but please be careful.

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