After much debate, on June 24, 2011, New York legalized gay marriage. New York is now sixth state to give same-sex couples the right to marry. Same-sex couples are now entitled to a variety of economic and legal benefits offered in the State of New York that up until now, were only afforded to heterosexual couples.
Same-sex couples will now be able to file their state income tax jointly, make unlimited lifetime transfers and an unlimited marital deduction at death without incurring New York gift and estate tax, and inherit by the laws of intestacy.
Prior to the enactment of the new law, having a Last Will and Testament was crucial for those in a same-sex relationship. If there was no will at death, same-sex spouses were at risk for losing everything because property would pass to a blood relative by operation of law. Now, however, a surviving same-sex spouse will be the first in line to inherit the decedent’s assets through intestacy.
In addition, before the new law, same-sex couples had to pay estate tax in New York when they made asset transfers above $ 1 million to their partners. Now, however, same-sex couples will be afforded the same benefits enjoyed by heterosexual married couples, and be able to make unlimited lifetime transfers and unlimited marital deduction at death without incurring New York gift and estate taxes.
Note however that this ability to make unlimited transfers is only state-based. While New York has decided to legalize same-sex marriage, same-sex couples are still not recognized on the federal level because of the Defense of Marriage Act (DOMA) which defines marriage as between a man and woman. Therefore, same-sex couples are still treated as single individuals in relation to federal estate tax (and income tax).
To set up an appointment to discuss how the new law will affect you and your partner, call New York estate attorneys at the Law Offices of Albert Goodwin at (212) 233-1233.