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Estate Planning For Unmarried Couples

Posted by Jason English | Jun 07, 2023 | 0 Comments

Unmarried Couples Need Estate Planning Too - Call Jason S. English Law, PLLC today for Estate Planning Assistance

According to statistics from the United States Census Bureau, the number of unmarried partners who live together has tripled over the past two decades. Today, there are more than 17 million people who are unmarried and living together. For one reason or another, many people choose to maintain long-term relationships but decline to get married. While this living situation is increasingly common, estate planning for unmarried couples can still be challenging. Jason English Law provides estate planning assistance to a wide variety of individuals and families in Texas. Call (512) 454-7548 to learn more.

Marital Status and Estate Planning in Texas

When someone has an estate plan, involving documents such as a will or a trust, their assets and liabilities will pass to loved ones according to their wishes as set out in those documents. Individuals can name virtually whomever they would like to be their beneficiaries in these documents. Marital status essentially does not matter in a carefully crafted estate plan.

If an individual does not have an estate plan, then the State of Texas will dictate how assets will be distributed at death. Specifically, for married couples, most assets will automatically be provided to the surviving spouse. If a couple is not married, however, their assets will not automatically go to their partner. Instead, they might go to their children, parents, or siblings. That means that if an unmarried couple wants their assets to go to their partner, they cannot rely on Texas laws to accomplish that goal for them—they need to engage in estate planning for unmarried couples.

Default Laws Favoring a Spouse

Estate planning for unmarried couples is arguably even more important than estate planning for those who are married. This is because many laws favor spouses over anyone else, including domestic partners, but even ahead of parents and children. Below are a few examples beyond passing assets to a spouse at death.

  • Estate Taxes: While the State of Texas does not have an estate tax, Texas residents may still need to consider how the federal estate tax will affect them. Married couples have a significant advantage when it comes to estate taxes. Legally married couples are not required to pay estate tax on any asset that transfers to their spouse at their death. Instead, estate taxes are taken only when the second spouse passes away. Unmarried couples do not have this delayed tax advantage.
  • Gift Taxes. Spouses can make gifts to each other back and forth for their whole lives without any consideration for tax. In fact, in Texas, as a community property state, those types of transfers are virtually irrelevant. However, if a couple is unmarried and makes a gift to one another, those must be considered for tax purposes. They need to be below the exclusion amount ($17,000 for 2023), or a tax must be assessed and paid.
  • Healthcare and Financial Decisions. Healthcare powers of attorney and similar designations can change who is designated to make decisions for healthcare purposes. However, married couples are usually the “de facto” designated individual for these decisions, even if there is no legal document giving them a power of attorney designation. An unmarried person's next of kin, instead of their domestic partner, will usually have the authority to make healthcare or financial decisions.

Unfortunately, without proper planning, the person that you may have assumed would be involved in critical decision-making, your partner, may be excluded from these decisions simply because you are not married. This does not mean that you have to get married, however. Instead, the couple may just need to coordinate with a Texas estate planning attorney to create a plan that works for their unique situation. Jason English Law provides comprehensive estate planning services to couples in all walks of life. Consider reaching out to our experienced staff to develop a set of estate planning documents designed around your needs.

Protecting Children as an Unmarried Couple

If an unmarried couple has children together, the surviving parent will automatically have full custody and responsibility for a child if one parent passes away. This works well for unmarried couples who are both parents to the same children, but what about blended families? Imagine an unmarried couple who both have children with other people. If one member of the couple passes away, that means that each child's surviving biological parent, who may or may not be involved in the child's life, will virtually automatically have full rights and custody. In some situations, that can tear a family apart.

Unmarried couples can take steps to avoid this type of outcome. For example, one parent may want to name their partner as the child's legal guardian if they pass away. If that happens, the child's remaining biological parent may still be involved, but the surviving partner can still be a part of the child's life.

Essential Estate Planning Documents for Unmarried Couples

The couple may want to sit down with a Texas estate planning attorney to make a plan to address the many issues that unmarried couples face regarding estate planning. Below are a few suggestions that unmarried couples might want to consider.

  • Will: A Last Will and Testament sets out how an estate should be passed along to beneficiaries. An unmarried individual can, for example, name their partner as their executor and leave assets to that person. A will can also provide specific instructions to care for children, including naming a partner as a child's legal guardian.
  • Power of Attorney: A power of attorney will allow one person to name their partner as someone who can make decisions for them. This is particularly important if one partner becomes incapacitated.
  • Living Will or Healthcare Proxy: A living will or healthcare proxy can name a specific individual to make healthcare decisions if you cannot make those decisions. This document is very important for unmarried couples because the other partner would generally not have any right to make this type of decision without such a document.
  • Payable on Death Accounts and Joint Accounts: Many unmarried couples function as if they are married when it comes to their finances. However, if just one partner is on any financial accounts, those funds may end up going somewhere else if that partner passes. Unmarried couples may want to consider payable-on-death accounts or joint accounts to ensure their partner has access to funds.

Texas is a state that recognizes common-law marriage. However, the rules for common law marriage are much stricter than simply living together, and many couples will not qualify for estate planning purposes despite living together for years. As a rule, couples should not count on common-law marriage as an effective estate planning tactic.

Get Help With Your Estate Plan

Estate planning for unmarried couples is even more important than for married couples. An experienced attorney can evaluate your situation and review with you your legal options for protecting your loved ones and each other, now and in the future. Call Jason English Law today at (512) 454-7548 to schedule your consultation and design an estate plan that works for you and your family.

About the Author

Jason English

Jason English grew up in his dad's personal injury law practice in Tarrant County, graduated from Texas A&M before getting his law degree from St. Marys University School of Law. Initially he worked in his father's firm on personal injury, wills and probate, as well as, family law cases. Soo...


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