Supreme Court Decision Leads to Same-Sex Marriage Wins

Gay Marriage, James Lange, Retirement, Social Security, Same Sex MarriageOn October 6, the U.S. Supreme Court denied review of five cases of same-sex marriage. This decision leaves standing marriage victories in three federal circuits, the 4th, 7th, and 10th and opens the door to the same-sex marriage in many more states.


On October 7th, the 9th Circuit Court of Appeals also ruled in favor of the freedom to marry in Nevada and Idaho.


There’s been a lot of progress and soon, same-sex couples will have the freedom to marry not only in 24 states and the District of Columbia, including today’s new additions of Indiana, Utah, Oklahoma, Wisconsin, and Virginia – but the path to marriage in 6 other states (Colorado, Kansas, North


Carolina, South Carolina, West Virginia, and Wyoming) is now paved. Despite the amazing momentum, the U.S. Supreme Court chose to defer for another day the national resolution that Freedom to Marry, businesses, elected officials, and families across the country have urged now.


To keep current with the recent events, please visit www.freedomtomarry.org.  All proceeds from my book goes to Freedom to Marry.

-James Lange


P.S. Once you get married you may be wondering what financial steps to take next. Give us a call today! We would be honored to help you through that process. 412-521-2732 (Western Pennsylvania Residents Only)

Same-Sex Couples Nearing Retirement: Get Married

If you're a same-sex couple in a long term committed relationship and are nearing retirement, get married.

Yalman Onaran of Bloomberg News discussed this issue with James Lange of the Lange Financial Group, LLC and had this to say:

“That's the simple advice that emerges from a new book by James Lange, a certified public accountant and attorney who specializes in retirement and estate planning. Of course love and feelings should dictate your decision first, but if you're looking at the financial side of things, then the balance has shifted in favor of marriage since the Supreme Court decision a year ago abolishing the Defense of Marriage Act, Lange argues.”

The chart below shows why marriage would benefit an aging same-sex couple.  A gay or lesbian couple could have higher Social Security benefits, more room to shelter income in IRAs all while avoiding inheritance taxes. 

Same-Sex, Gay, Lesbian, LGBT Couples Nearing Retirement - Get Married

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In this article Yalman Onaran touches on some of the caveats to same-sex marriage for financial reasons including whether you live in a state that still doesn’t recognize gay marriage as well as how far you and your partner are from retirement.  He shares his own experience with marriage and the financial benefits that resulted from getting married and how the landscape has changed post the repeal of DOMA.

To read the rest of this article in Bloomberg News, please click on the link below.

Click this link to read the article

Source: Yalman Onaran, Bloomberg News

An Update For Our Pennsylvania Readers

PA Same-Sex Marriage, James Lange, Retirement, DOMAOn May 20, 2014, the gay marriage ban in Pennsylvania was overturned by U.S. District Judge John E. Jones III.  In addition, Pennsylvania will now recognize same-sex marriages performed in other states that recognize same-sex marriage.  Governor Tom Corbett has announced that he will not appeal the decision, and for the first time in the state’s history, same-sex couples are now permitted to marry.  This is wonderful news for the residents of our state who have been waiting for a long time to marry their same-sex partners, but it also means that some of the information in this book as it relates to Pennsylvania residents has become outdated (as, frankly, I hoped it would become).  Rather than rewrite the book, I thought it would be simpler to provide Pennsylvania residents with a summary of the areas in which their lives will be affected as a consequence of the Pennsylvania decision.

First, if you’re counting, there are now 32 states that do not recognize same-sex marriage – the original text references 33 states.  Chapter 1 states that there are 17 jurisdictions that allow same-sex couples to legally marry, but, as of May 20, 2014, that number has risen – Pennsylvania became the 18th state (plus the District of Columbia) to do so.

Next, there are several references in the book to the federal criteria of “The State of Celebration vs. the State of Domicile,” as well as recommendations that readers consider marrying in a state that does recognize same-sex marriage.  As of May 20, 2014, same-sex couples who reside in Pennsylvania no longer have to travel out of state to get married – unless, of course, they want to – in order to enjoy the same benefits as straight married couples.  Let’s examine some of those benefits in greater detail.

  • Chapters 1, 4 and 5 discuss some odd Pennsylvania conundrums that, I’m sure, legally married same-sex couples will be very happy to see go by the wayside.  In 2013, legally married (in another state) same-sex couples who lived in Pennsylvania were required to file their Federal tax returns as “Married,” but their State returns as “Single.”  Those taxpayers will finally be able to file both their 2014 Federal and Pennsylvania returns as “Married,” and they also have the option to file amended Federal returns for up to three years prior, if it makes financial sense for them to refile as “Married.” (Marital status does not affect the amount of state tax that Pennsylvania residents pay, so filing amended state returns will not be necessary.)  
  • Chapter 1 recommends that your wills and trusts be prepared based on current laws, but include special provisions in case same-sex marriage becomes legalized in Pennsylvania.  Now that the state recognizes same-sex marriage, such highly customized estate planning documents likely will not be necessary. 
  • The beneficiary of a deceased same-sex partner used to be subject to a 15% Pennsylvania inheritance tax whether they had been unmarried or legally married (in another state), and it was my recommendation that wealthier couples consider either making large financial gifts in order to avoid that tax, or purchase life insurance to pay the tax.  Going forward, those strategies will be irrelevant because those same couples will not pay Pennsylvania inheritance taxes on their spouse’s assets (the same as straight married couples).
  • Finally,  from the human perspective, the surviving spouse of a legally married same-sex couple now has, barring extenuating circumstances, sole authority in all matters pertaining to the disposition of their spouse’s remains in Pennsylvania – prior to this ruling, a same-sex spouse couldn’t even be named on a death certificate.
  • Chapter 2 discusses the benefits of marriage as it relates to IRA’s and retirement plans.  Indeed, the benefits are so significant that from the federal perspective, including both income taxes and estate taxes, I recommend that all committed same-sex couples consider the financial advantages of getting married.  (Please reread that chapter if you are on the fence about it.)  But now, there is no need to travel to another state to marry to receive the same favorable federal tax treatment that the survivor of a straight married couple would receive on their deceased spouse’s IRA or retirement plan.  Now if you marry in Pennsylvania, you will assure your surviving spouse of a much better standard of living in his or her retirement than if you had not married. 
  • Pennsylvania does not currently tax retirement income, so the change in the law will have no effect on your state income taxes.  There will be a significant change with respect to state inheritance taxes, though – an individual who inherited a retirement plan from a legally married same-sex spouse, used to have to pay the state’s highest inheritance tax rate of 15%.  In many cases, this amounted to a significant amount of money. Now, that same individual will pay nothing in state inheritance tax. 
  • Chapters 1 and 3 both show, if you are a Pennsylvania resident, the monthly benefit that you would have been eligible for from Social Security, was “in question.”  This was because, unlike the Internal Revenue Service, the Social Security Administration recognizes same-sex marriages in states that recognize same-sex marriages.  If you are legally married, but do not live in a state that recognizes same-sex marriage, you are not currently eligible for spousal Social Security benefits.  The Social Security Administration recognized the inconsistency in their position and encouraged same-sex couples in all states to apply, but asked you to be patient as they develop and begin to implement new policies on this subject.  Well, legally married same-sex couples who live in Pennsylvania don’t need to wait any longer – they can now receive Social Security benefits based on their own earnings record, or the earnings record of their spouse if it is higher.  Remember, though, that the decision about when and how to apply for Social Security benefits can have a far greater impact on your financial security than what the staff at your local Social Security office might lead you to believe. Decisions about timing Social Security benefits should not be done without first talking to a trusted advisor.
  • In the same context, please have a second look at the graph on page 80, which illustrates what happens if Dr. Dan had used the “Apply and Suspend” technique for his Social Security benefits, and subsequently died.  This graph takes in to consideration a 15% inheritance tax assessed on Dr. Dan’s retirement plan.    Since Pennsylvania now recognizes same-sex marriage, this tax will no longer be assessed at his death, which would make the difference between those two scenarios even more dramatic.

You should also have a look at the graph on Page 131, which illustrates the difference between taking my advice and ignoring it.  The steep decline in assets at Baker Bob’s age 80 was due to the 15% Pennsylvania inheritance tax he owed on Dr. Dan’s estate.  Now that Pennsylvania recognizes same-sex marriage and the inheritance tax no longer applies to the surviving spouse, the argument for marriage will be even stronger.

It has been a long time coming, but I am happy to see that Pennsylvania has finally made this change to their law.  Same-sex Pennsylvania couples who marry will finally be treated fairly, with the same dignity and respect as straight married couples.  Since this represents new territory for you, I encourage you to talk with a trusted advisor about the specifics of your own situation, so that you fully understand how these changes will affect you and your partner or possibly your spouse.

 

Whitewood vs. Wolf – Historic Victory for Civil Rights in Pennsylvania

Same-Sex Marriage, Pennsylvania Law, James Lange, Lange Financial Group, LLCWhitewood vs. Wolf represents an historic victory for civil rights in Pennsylvania. Now Pennsylvania same-sex couples can get married in Pennsylvania and not only enjoy all the traditional benefits of marriage, but also the financial benefits of marriage.

Windsor gave all same-sex married couples the unlimited marital deduction for federal estate tax purposes. Revenue Ruling 2013-17 gave all same-sex couples equal income tax treatment. Whitewood gives PA same-sex couples the right to marry in PA and have their out-of-state legal marriage recognized in PA.

From an economic standpoint, social security spousal benefits which can easily be hundreds of thousands of dollars over time, is a new economic right for same-sex married couples. Marital equality is economic justice.

– James Lange
CPA / Attorney

Join us for a free workshop on Saturday December 7th!

James Lange, President of Lange Financial Group, LLC will be presenting a day of free workshops created specifically to help same-sex couples make the most out of what they've got!

The workshops will focus on what PA couples can do to take advantage of the downfall of DOMA and to ensure that they and their families are as financially and legally secure as possible.

All workshops are free and refreshments will be served.

9:30 AM- 11:30AM – Who Says You Can't Control from the Grave?  How Same-Sex Couples Can USe Trusts to Protect Their Families.

1:00PM – 3:00PM – The Demise of DOMA: New Financial Planning Strategies for Pennsylvania Same-Sex Couples

3:15PM – 3:45PM – What's a Better Investment Strategy: Active Investing or Passive Investing with Index Funds?

Full Invitation

Civil Rights Leader, Evan Wolfson, to appear on The Lange Money Hour

Tune in to KQV 1410AM (or streaming at www.kqv.com) on Wednesday December 4th at 7:05pm EST to hear from one of Time magazine’s 100 Most Influential People Alive, Evan Wolfson.

A former director of Lambda Legal, and founder of FreedomtoMarry.org, Evan is the formost authority on the marriage equality issue and a native Pittsburgher to boot.

Please plan to tune in, or stream the show live and be a part of an historic and important civil rights show with Evan Wolfson, hosted by Jim Lange.

10 Things LGBT People Can Be Thankful for This Thanksgiving

 

 

Just in time for Thanksgiving tomorrow, the HuffPost’s Gay Voices released this wonderful list of things that LGBT People (and so many others too) can be thankful for.

Illinois Becomes the 16th State to Legalize Same-Sex Marriage!

Historic news this morning as another state recognizes same-sex marriages.  Democratic Governor Pat Quinn signed the bill on a desk that President Lincoln used to write his first inaugural address.

 

Congratulations Illinois!

 

Lange Financial Group, LLC in the Pittsburgh Business Times!

Our LGBT Initiative has been featured in the Pittsburgh Business Times.  The release highlights our efforts to bring more and better estate planning, tax planning, and investment information to same-sex couples in Pittsburgh.  With the downfall of DOMA, many new opportunities present themselves to couples in Pennsylvania, despite the legal status of same-sex marriage in our state.

Our firm is hosting a radio show with civil rights leader Evan Wolfson, having a free workshop for same-sex couples, publishing an article on the Demise of Doma and of course, just re-launched this website to the pulic.

Click Here To Read The Full Article  

Welcome to Out Estate Planning

Welcome to Out Estate Planning – A retirement and estate planning source for LGBT couples in a shifting legal landscape