(NewsNation) — Society is seeing a shift when it comes to couples deciding whether to officially get hitched.
As of two years ago, the number of couples opting to share a life together without getting married was up more than 40% from 20 years earlier.
So, living with a partner has become more common.
But how does being an unmarried couple stack up to a married couple when it comes to legalities?
How is being unmarried different than being married for medical decisions?
Unmarried couples are faced with a more difficult path than those who are married when it comes to medical decisions.
Despite HIPAA rules, spouses are generally allowed access to each other’s medical records to make decisions on behalf of one another. Unmarried partners must obtain a legal document called a durable medical power of attorney.
“This person will be able to work with doctors and other health care providers to make sure that you receive the kind of medical care you need and would want,” according to LegalVoice.com.
“This document also allows you to appoint someone to make health care decisions for your children in the event you are not able to.”
Unmarried couples are also advised to inquire about a financial power of attorney if there’s a need to contact their partner’s health insurer about their coverage or discuss the status of a claim.
How do unmarried couples differ legally from married couples for shared assets and Social Security?
For shared assets, a majority of U.S. states consider them jointly owned if they’re titled in both spouses’ names. Unwed people who inherit assets from their partner can be subjected to federal estate taxes.
“When you are an unmarried couple living in a domestic partnership, you lose most, if not all, of the federal government benefits provided to married couples,” said Chris Van Atta, City National Bank.
“A surviving spouse who is a U.S. citizen is eligible to take advantage of the unlimited marital deduction, which means that all funds received by the surviving spouse would be received free of any federal and state estate tax.”
Regarding Social Security, married couples are entitled to spousal benefits. How that works is that either spouse will collect half of the benefit if it’s bigger than their own. Unmarried partners can protect themselves if they purchase life insurance and name each other as beneficiaries.
There’s also the option of a cohabitation agreement, “which set out the rights of each partner with respect to the assets that each brought into the relationship and what happens to the assets that were acquired during the relationship should they decide to break up in the future,” says City National Bank’s Joe https://www.kqzyfj.com/click-101419140-11167246man.
How do unmarried couples differ legally from married couples for retirement assets?
Retirement savings have different parameters for those who are married versus those who aren’t.
Those assets, which can’t be jointly owned, provide surviving spouses with lesser rights if the assets are not left to them, even if they are designated as a beneficiary. However, if a spouse fails to appoint a beneficiary of their retirement accounts, the assets will usually go to the surviving spouse by way of probate.
Unmarried partners can only ensure retirement assets go between them by naming that individual as the account’s beneficiary.
