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Los Angeles Estate Planning Attorney | Law Office of Philip J. Hoskins

 Same-Sex Marriage Rights 

The U.S. Courts has ruled against Proposition 8 which means that non-heterosexual couples may now longer marry in this state. This means that all the same laws that apply to opposite gender marriages apply to same gender marriages.

California still offers Registered Domestic Partnerships, however. There are a number of differences between these and marriages, however. Primary are major differences with regard to federal programs and taxes.

Recent announcements indicate that same-gender married partners will be treated by the federal government for most purposes the same way opposite gender couples are treated. This applies for immigration, Social Security and other programs and departments.

The one major unknown at this point is how the Internal Revenue Service will deal with couples whose marriage was valid where celebrated but not in the state they move to. For those who live in states where their marriage is legal, income tax laws require the filing of a married federal tax return.

Below are comments that apply to Domestic Partners only.
  • Who can become Domestic Partners?

Any same gender couple can register as Domestic partners. Also, opposite gender couples over the age of 62 may so register.

  • What rules apply to Domestic Partners?

This means that all income and all assets and savings acquired after registration (or after January 1, 2005, depending on whether the law is considered to be retroactive), and all assets accumulated from earned income are presumed to be equally owned (community property), regardless of titling of deed, asset, or account. In general, there is a requirement of a written agreement to transmute property from community to separate or from separate property to community property, subject to specific family law provisions for reimbursement of certain contributions based upon a tracing argument. See Fam C §852.

The rules of community property also will apply to savings accounts, stock options and accounts, real property acquired, businesses developed, and IRA/pension benefits accrued -- though it is unclear how all of these rules will be applied to domestic partners. In addition, pre-registration assets, or gifts or inheritances received at any time, are presumed to be separately owned -- with the well-established complex statutory rules for allocating mixed assets/debts applying as well.

Moreover, as with any "married’ couple, the lesser-earning partner is eligible for post-separation spousal support as determined by family law court judge, based on statutory factors; spousal support is generally for a period no longer than half the "marriage." So too, the fiduciary duty of married couples will be imposed on partners, with potential liability for mismanagement or wrongful transfer of community property assets.

Most significantly, in the future dissolutions of domestic partnerships will require judicial process, the same as for marital dissolutions, except for couples registered for less than five years with no disputes, few assets, and no real property and no children, who can use the "extra" summary dissolution process of Secretary of State termination. See Fam C §299.

And, just as with married couples today, couples with pre-registration assets/debts may, in some situations, have those disputes resolved by the Family Court; in other situations, a separate lawsuit over pre-registration claims may be possible, and in some situations, the two lawsuits can be combined in one action -- but only if both parties waive their right to a jury trial for the adjudication of pre-registration assets.

The law states that provides that any reference to the date of a marriage shall be deemed to refer to the date of registration with the state of a domestic partnership for purposes of various laws concerning rights and responsibilities of domestic partners. It also provides that a premarital agreement between domestic partners registered with the state prior to January 1, 2005, shall be enforceable if it meets certain conditions and requires the Secretary of State to include specified language pertaining to premarital agreements in the letter the Secretary of State must send to all registered domestic partners on or before June 30, 2004, on or before December 1, 2004, and on or before January 31, 2005.

  • Tax issues

For purposes of California tax laws, Domestic Partners are treated the same as married couples.

  1. You must file your state tax return as married, either filing jointly or separately
  2. You cannot, however file your federal tax as married.  For all purposes under federal law you are regarded as not married.
  3. Property transfers between Domestic partners, whether during your life or on death are exempt from California taxes, but not federal taxes.
  4. The IRS has recently ruled that Domestic Partners must claim one-half of each other's income on their federal tax returns. This is a major issue that you should speak about with your tax advisor. IRS publication link A portion of the ruling:

    Community or Separate Property and Income

    If you file a federal tax return separately from your spouse, you must report half of all community income and all of your separate income. Likewise, a RDP (and an individual in California who is married to an individual of the same sex) must report half of all community income and all of his or her separate income on his or her federal tax return. Generally, the laws of the state in which you are domiciled govern whether you have community property and community income or separate property and separate income for federal tax purposes. The following is a summary of the general rules. These rules are also shown in Table 1.

    Community property.   Generally, community property is property:

    • That you, your spouse (or RDP/California same-sex spouse), or both acquire during your marriage (or registered domestic partnership/same-sex marriage in California) while you and your spouse (or RDP/California same-sex spouse) are domiciled in a community property state.
    • That you and your spouse (or RDP/California same-sex spouse) agreed to convert from separate to community property.
    • That cannot be identified as separate property.

    Community income.   Generally, community income is income from:

    • Community property.
    • Salaries, wages, and other pay received for the services performed by you, your spouse (or RDP/California same-sex spouse), or both during your marriage (or registered domestic partnership/same-sex marriage in California).
    • Real estate that is treated as community property under the laws of the state where the property is located.

       Separate property.   Generally, separate property is:

    • Property that you or your spouse (or RDP/California same-sex spouse) owned separately before your marriage (or registered domestic partnership/same-sex marriage in California).
    • Money earned while domiciled in a noncommunity property state.
    • Property that you or your spouse (or RDP/California same-sex spouse) received separately as a gift or inheritance during your marriage (or registered domestic partnership/same-sex marriage in California).
    • Property that you or your spouse (or RDP/California same-sex spouse) bought with separate funds, or acquired in exchange for separate property, during your marriage (or registered domestic partnership/same-sex marriage in California).
    • Property that you and your spouse (or RDP/California same-sex spouse) converted from community property to separate property through an agreement valid under state law.
    • The part of property bought with separate funds, if part was bought with community funds and part with separate funds.

    Separate income.   Generally, income from separate property is the separate income of the spouse (or RDP/California same-sex spouse) who owns the property.

    Table 1. General Rules — Property and Income: Community or Separate?

    Community property is property:

    • That you, your spouse (or RDP/California same-sex spouse), or both acquire during your marriage (or registered domestic partnership/same-sex marriage in California) while you are domiciled in a community property state. (Includes the part of property bought with community property funds if part was bought with community funds and part with separate funds.)
    • That you and your spouse (or RDP/California same-sex spouse) agreed to convert from separate to community property.
    • That cannot be identified as separate property.

    Separate property is:

    • Property that you or your spouse (or RDP/California same-sex spouse) owned separately before your marriage (or registered domestic partnership/same-sex marriage in California).
    • Money earned while domiciled in a noncommunity property state.
    • Property either of you received as a gift or inherited separately during your marriage (or registered domestic partnership/same-sex marriage in California).
    • Property bought with separate funds, or exchanged for separate property, during your marriage (or registered domestic partnership/same-sex marriage in California).
    • Property that you and your spouse (or RDP/California same-sex spouse) agreed to convert from community to separate property through an agreement valid under state law.
    • The part of property bought with separate funds, if part was bought with community funds and part with separate funds.

    Community income 1,2,3 is income from:

    • Community property.
    • Salaries, wages, or pay for services of you, your spouse (or RDP/California same-sex spouse), or both during your marriage (or registered domestic partnership/same-sex marriage in California).
    • Real estate that is treated as community property under the laws of the state where the property is located.

    Separate income 1,2 is income from: 
     
    • Separate property. Separate income belongs to the spouse (or RDP/California same-sex spouse) who owns the property.

     Click here for the IRS bulletin

  • Making the Registration Decision

FIRST, decide whether registration is vital for your relationship (e.g., to obtain insurance or other private benefits, to be eligible for adoption procedures, to minimize property tax or transfer tax implications)

•Then, if registration is clearly vital for you, evaluate what private written agreements are desired to modify the community property rules regarding property or debt or inheritance issues, or spousal support obligations, and if such modifications are desired, draft and execute the required agreements

• For those facing adoption issues and for emotional reasons: make sure you have your limiting agreements in place BEFORE you register, not afterwards (if you have not already registered)!

SECOND, decide whether registration is clearly harmful to your situation (e.g., disqualification from benefits, exposure to partner's debt, privacy issues)

• If registration is clearly harmful for the two of you, evaluate what private written agreements are needed to provide for property or debt or inheritance rights and benefits; if such agreements are necessary, draft and execute the agreements

• Reasons to not register: Immigration concerns, tax issues, eligibility for public benefits, exposure to debt liability, high-risk business/professions, and remember to keep assets separate until your written agreements are signed

THIRD, if registration is neither vital nor harmful, decide whether you prefer registration (with or without private agreements limiting the community rules) or non-registration (with private agreements providing for property and debt protections?

• Factors to consider: consistency with your basic arrangements (are you a shared-asset couple or a separate property couple? If basically shared, registration probably is best; if basically separate assets, not registering is probably best). Consider the tax implications, symbolic value, simplicity of rules, and the making of a political statement, and the other benefits of registering (e.g., wrongful death claims)

• Once the decision has been made, either register (or keep your registration active if you have already registered) and then draft and execute the appropriate agreements:

• Property co-ownership agreements: ownership and management of property

FOURTH, remember: registering as a California Domestic Partner does not relieve couples of the duty to take care of estate planning and tax planning issues.


This has been a brief summary of some points regarding Domestic partnerships. If any of the above points applies to your circumstance, we urge you to seek legal counsel before deciding upon a course of action.


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