Kansas and Missouri Estate Planning

What Do Mississippi’s Common Law Marriage Rules Mean for a Recent Lawsuit?

Estate planning is far more complicated when the couple is not legally married.

It is not merely celebrities who have conflicts over estates.

It does not always involve large fortunes either.

A recent The Clarion-Ledger article asks “Is common-law marriage legal in Mississippi?”

According to the article, Thomas Ellis was the son of Cleveland “Doc” Ellis and he brought a lawsuit challenging Maria Jackson’s right to his father’s Social Security benefits.

Why?

He claims Maria was not officially married to Cleveland.

Maria Jackson, who was also known as Maria Ellis, was listed as Cleveland’s wife in his obituary.

A family member did claim the couple was married in the 1990s while Thomas Ellis was in prison.

According to Thomas, his father only had one wife—Carrie Ellis.

Cleveland and Carrie separated in 1954, but were never divorced.

Carrie died in 1985.

Cleveland and Maria began living together the year after the separation until Cleveland died in 2015.

Why is this significant?

Mississippi abolished its common-law marriage status in 1956.

What does this mean?

Unmarried individuals who live together are not entitled to their partner’s property, benefits, or assets.

If a common law marriage was established before the abolishment of the law, would it be recognized afterward?

A federal judge dismissed the suit; however, it can still be refiled.

This whole lawsuit could have been avoided through a legal marriage.

Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.

For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.

Reference: The (Jackson MS) Clarion-Ledger (September 27, 2017) “Is common-law marriage legal in Mississippi?”

What Should I do Now that I Am an Unmarried Father?

Dude, just marry the girl!

While every child has a "father" (it's biology 101) by default, every child deserves to have a "dad" by design.

Statistics (and common sense) confirm that a child who grows up in a traditional two-parent household is more likely to stay out of trouble and grow up to have a better life.

All that noted, what if you do not take Uncle Kyle's advice? 

A recent article from New Jersey 101.5 provides some guidance for you in an article titled "Having a baby, but not married? Some financial advice."

The article notes that in many states the rights of unmarried couples are different than those of married couples.

When it comes to a minor child born into such circumstances, child custody issues are the same regardless whether you are married. In fact, courts make decisions based upon the "best interest of the child" standard.

What if one parent dies?

In that case the surviving parent will be the default guardian.

What if both parents die?

That can get tricky indeed, especially if neither had a will appointing a guardian (back up parent).

Do you really want a probate judge (who does not know you and the families involved) making that decision?

In addition to an unforeseen death, you also need to consider what could happen if you and your partner split up.

Did you know that the distribution of property is very different between married and unmarried couples who break up?

Well, it is.

If you are married, almost all property will be distributed equitably and alimony can be awarded.

On the other hand, when unmarried couples split up any individual property is retained by the original owner. Only jointly-owned property, like a home with both names on the deed, is divided between the parties. Further, neither party of an unmarried couple gets alimony, but this may be addressed by an unmarried couple if they sign a Cohabitation Agreement.

Also, the laws in most states treat married and unmarried couples differently if you die without a will.

When you die without a will, you are subject to the intestacy laws of your home state. This means property typically goes to a surviving spouse and surviving children before passing to parents and other relatives.

If you have a will, then you can specify who inherits your assets and how they are inherited.

This is especially important when you have a minor child.

Not so when you are unmarried. 

If you hold title to the home you share with your partner and child, then your child inherits the home ... not your partner. This can lead to further legal excitement.

Oops.

There are also federal and state estate taxes to consider.

If you are not married, planning for the tax-efficient transfer of assets at death (especially important for a high net worth unmarried couple) is tougher than planning for a married couple.

A married couple will not have any estate tax due upon the first death if the estate plan fully utilizes the unlimited marital deduction. However, this deduction does not apply to the survivor of an unmarried couple.

Plus, some states have both an estate tax and an inheritance tax. (Fortunately, this does not include Kansas or Missouri.)

What about making decisions regarding your final wishes?

If you are not married, there will be problems.

Whether the final decisions are regarding your health care, funeral or disposition of your remains, many state laws provide control to a surviving spouse.

If you are not married, then your closest surviving adult family member gets to decide these issues.

That could be a parent or your siblings.

Again, you can simply a lot of your life for yourself and your child ... if you just marry the girl.

Either way, contact an experienced estate planning attorney to help you navigate these waters whatever you decide. 

Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.

For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.

Reference: New Jersey 101.5 (December 28, 2015) "Having a baby, but not married? Some financial advice"

How do I Avoid Money and Estate Planning Issues with My Live-In Girlfriend? [UPDATED]

Well, you may not like my personal opinion, so I will reserve that until the end.

Regardless your marital status, money matters can cause stress in any relationship. That noted, running away from the friction will not make it go away.

No, time to man up, my friend.

Consequently, I agree with a recent article in The Motley Fool titled “Financial Moves Unmarried Couples Should Consider Making.”

Communication is key.

As part of that communication, the article suggests discussing which income and assets are joint and which, if any, are to remain separate. 

Create a budget and a plan for keeping it. Experts say this means you should calculate how much money is coming into the household and how you both want to spent the same. 

Think long term, too.

Plan for retirement savings and other savings goals like a down payment on a house or college expenses.

Most of all, live below your means.

This is especially true if one or both partners has substantial debt. Make it a priority to get that paid off. 

What about estate planning?

As the original article adroitly notes, unmarried couples do not enjoy some of the automatic protections married couples have, especially as far as estate planning.

Most state laws give a spouse the right to inherit automatically. However, the rights of an unmarried cohabitant are really nonexistent.

So, how should you arrange your finances to leave money to your partner while you are not married?

The original article offers two strategies. 

First, consider holding title as joint tenants with rights of survivorship. At the death of one owner, the survivor retains full ownership without probate, without a will and without regard to the laws of intestate succession.

By the way, beneficiary designations on retirement accounts and life insurance policies can also do the same thing.

Second, consider appointing each other as agents under general durable powers of attorney for financial decisions and advanced health care directives.

This will enable  you to take care of financial and health care decisions should one of you become incapacitated.

Remember to communicate openly about your wishes, then make plans to put them in place with the help of an experienced estate planning attorney.

Now, I promised to share my thoughts on your situation. Remember, I am that old-fashioned guy from an era before smart phones. The Colts were in Baltimore, the Rams were in Los Angeles and the Cardinals were in St. Louis. No, I am not kidding. Google it yourself.

Just marry the girl.

Period.

Here is sage advice a fraternity brother of mine drilled into his sons and it seems to have taken with them ... and is worth repeating here.

Five Practical, Time-Proven Steps to a Successful and Happy Life

1. Get an education/learn a trade that has actual value in the marketplace.

2. Get really, really good at it.

3. Find a girl you cannot live without and marry her.

4. Start a family, so I can enjoy some grandchildren while I can still play catch overhand.

5. Do NOT screw up the order of numbers 1. through 4.

[UPDATED October 30, 2015]

Family law attorney Phil Glasser in Overland Park, KS (12323 Farley, Overland Park, KS 66213, 913-663-1971, [email protected]) contacted me regarding this blog post with an important consideration for Kansas cohabitants. Did you know Kansas recognizes "common law marriage" and when that exists there is no "common law divorce" - it is the real thing.

It seems Phil had a client who had filed a "married joint federal income tax return" with his "live-in girlfriend."

That move came back to bite him. Big time.

When he broke up with her, she sued for divorce and used the the tax return as evidence of their "marriage." 

She was successful.

Ouch.

Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.

For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.

 Reference: Motley Fool (October 17, 2015) “Financial Moves Unmarried Couples Should Consider Making”