LGBTQ+ Protection in the 2nd Trump Era

By Brandon Clark, CPA

LGBTQ+ community members face a high level of uncertainty and vulnerability as the Trump administration sets it priorities and starts enacting policy through executive orders and actions.  Attacks on DEI and erasure of transgender rights have brought us back to a level of vigilance we haven’t needed in years. 

While anti-LGBTQ+ rhetoric and hostility can bring us back to traumatic points in our lives and leave us fearful, it’s important that we not forget our strength. We must do what we’ve always done in these times: form community, educate and protect ourselves.

Here are notes from our January webinar with Estate Attorney Lee Carpenter of Offit Kurman, Family Law Attorney, Summer Abel of Offit Kurman, and Financial Advisor Brandon Clark, CPA of Toler Financial Group.

Financial Protection

Advice for protecting yourself financially in current circumstances sounds similar to timeless advice you’ve likely heard, but it’s all the more important now. Our community is more likely to work in fields that will be affected by budget cuts or layoffs.

Maintain Ample Financial Reserves: Maintaining 3-6 months of living expenses (or monthly pay if simpler to calculate) is ideal for those with no concerns about their work.  If you are vulnerable to being laid off, we suggest increasing to 1 year of living expenses. Also, it’s a great time to start or revisit your plan for goals like retirement, college, and big purchases to avoid financial stress.

Don’t try to time the markets: There’s an equal chance that markets will go up and down over these next 4 years. While things feel uncertain and sometimes dire, the truth is we don’t know what the future holds.

Focus on what’s within your control: Financial Planning is a process where we specifically develop a tailored plan based on your family’s strengths and risks. Some generalized advice follows:

·      Protect your income – Make sure you have life and disability Insurance

·      Avoid consumer debt and spend within your means.

·      Assess how much reserves are appropriate for your case

Legal Protections for Your Family

Legal Protections offered by marriage – should you get married if you’re not already? Marriage offers legal and financial protections that can’t be duplicated by wills and other legal documents.

If you are a same sex couple and are not currently married, getting married now could be ideal in the event same sex marriage is attacked by the administration. Since marriages occur on the state level this could help to preserve marriage recognition at least on the state level depending on how an attack on same sex marriage is waged.

Benefits of marriage: Financial protections of marriage include the ability to file jointly or separately which in some cases can save couples on their taxes. Additionally, in the event of a partner’s death: 1) IRAs and retirement accounts can be inherited by a spouse and treated the same as their own retirement account whereas an account inherited by any unmarried individual would need to be taxed and emptied by the end of 10 years after the decendant’s death. 2) Social security: A surviving spouse is able to receive retain the higher of their own on their spouse’s social security benefit, which is ideal especially if there is a discrepancy is years worked and income levels between spouses.

Prenups, postnups are always a good idea. Marriage is a legal agreement, a prenuptial agreement (if you plan to get married) or postnuptial agreement (if you’re already married) makes sure that you and your spouse’s wishes determine how assets and interests are divided in the event you dissolve your marriage. This leaves less to chance for an activist judge to decide. Also, make sure you address how any genetic material or embryos from IVF should be treated. These are an important part of LGBT family creation.

Adoptions are essential for any parent that is not named on a birth certificate. Don’t leave it to chance even if you’re married. You don’t know how a judge might rule for guardianship in a case where a surviving spouse/partner is not documented as a legal parent.

Name and Gender Marker changes for Transgender individuals: Name and gender marker changes should be completed consistently across all documents: Legal name change ->  Social security record -> driver's license -> legal and financial documents -> passport -> birth certificate

Estate Planning

Estate Planning is always an important tool for protection but is paramount now as we risk the Trump Administration attacking same sex marriage. Before same sex marriages were legal, LGBT+ couples used estate planning to ensure that spouses and chosen family were the designated beneficiaries of their estates. Similarly, it’s time to reemphasize the importance of this tool once again. We’ll address the various tools of estate planning below:

Wills: Wills spell out the important details of what you would like to happen after you die. Who should assets be left to? Who do you want to be your children’s legal guardians? At what point should your children have access to assets left in your estate? Who do you want to be the person responsible for executing your wishes according to your will (your executor)? While a will is an important document, its only one part of your estate. Asset titling and beneficiary designations are equally important and should be coordinated and consistent with your will.

Titling Assets: Non-retirement assets like homes, bank accounts and investment accounts can be titled in the name of one or more individuals.  A person named on an account or property title are its legal owners and who will have ownership rights in the event of your death. The titling of assets should be coordinated with your will to avoid any inconsistency.

Beneficiary designations: Retirement accounts and insurance policies have beneficiary designations that direct who will inherit an asset after an owner’s death.  The person(s) named as beneficiary will receive the asset without consulting a will or probate. It’s therefore important that beneficiary designations are reviewed in estate planning and are consistent with wills.

Financial Powers of Attorney: powers of attorney are legal documents that allows a designated person to act on your behalf. A durable power of attorney allows a designated person to act on your behalf in the event you are incapacitated. These documents provide important continuity to ensure that you and a trusted person can maintain access to financial accounts and assets in all circumstances except death.

Advanced Medical Directives: Medical directives (also called living wills) allow you to specify your wishes for medical care in the event you are unable to speak for yourself. They also allow you to direct medical points of contact and decision makers. Designating who should make decision in the event you can’t speak for yourself is important since a next of kin or spouse is legally given this responsibility. A medical directive helps preserve this right in the event your marriage is no longer valid.

Trusts: Trusts are not necessary for most individuals and are beyond the scope of what we’ll cover here. One place where trusts can be helpful to LGBTQ+ individuals if you have extended family members who might be hostile towards your nuclear family unit. Trusts can help to avoid probate having assets directly passed to beneficiaries named in a trust. Avoiding probate can provides privacy avoiding public disclosure of what assets are passed to whom and avoid scrutiny of hostile family members.