PALM SPRINGS, Calif. -- As the New Year begins, many couples across the country will resolve to become more proactive about financial planning in the coming year.
For those who are gay, this already difficult task is made more so by complicated state and federal tax regulations. To address the issue, Jim Casey [pictured at left], president and CEO of Integrated Wealth Management, has created a presentation called “The High Cost of Being Gay” to assist same-sex couples navigate these complex issues.
“Tradition tells us that we enter into committed relationships for better or for worse, and for richer or for poorer. For many gay couples in America, the reality is ‘worse’ and ‘for poorer’ these days,” Casey said.
“Even if the state you live in recognizes your marriage, the IRS and federal government do not. From estate taxes and health insurance, to retirement accounts and the pricey preparation of vital legal documents, most gays and lesbians do not realize the hard costs and the efforts needed to protect themselves.”
Throughout the presentation, Casey reviews the importance of estate planning, tax planning and financial planning for same sex couples and the steps they can take to begin the process. However, he not only discusses the financial side, but he also explores the very emotional aspect of this important topic.
“Love is not always enough. No matter the strength of your partnership, unmarried partners don’t enjoy the protection or legal benefits afforded to married couples. To put it bluntly, in the eyes of the federal government, you’re strangers.” Casey said. “It is so important to begin this conversation with your partner.”
For example, if you have a joint bank account with your partner and he/she makes $200,000 a year and you make $50,000 a year, the $150,000 could be considered a ‘gift’ to you and could therefore be taxable by law. Furthermore, even tax preparation can cost more, since gay couples are required to file two sets of returns.
Heterosexual married couples can contribute $5,000 annually to a spousal IRA for a non-working spouse. However, non-working gay partners cannot receive these contributions from their working spouse.
In terms of estate taxes, same sex couples must pay federal estate taxes on amounts that exceed the 2011 exemption of $5 million, because federal law supersedes state law. In that same vein, heterosexual married couples can transfer an unlimited amount of assets to each other during their lives and at death without paying estate taxes.
The situation is indeed complicated, but there are answers, said Casey, a recognized expert in the world of finance, as well as a Federal Club member of the Human Rights Campaign and staunch advocate for gay and lesbian rights.
About Integrated Wealth Management
Integrated Wealth Management is an independent wealth management firm representing hundreds of individuals, businesses, and nonprofits. Integrated Wealth Management focuses on helping its clients attain their current and future financial goals by providing an exceptional level of personalized service and financial advice, and adapting quickly to changing client circumstances, market conditions or tax laws.
The full-service firm provides: Wealth Management Services, Fiduciary Services, 401(k) Design and Management, Investment Reporting Services, Financial and Retirement Planning and more. For more information, visit HERE or call 866-888-6563 ext. 113.