Domestic Partnerships: New Planning Opportunity Available in California

All couples in California were quietly granted a new right on Jan. 2, 2020: the ability to register as domestic partners. Previously, this right was only permitted for same sex couples or heterosexual couples where both parties were over age 62. Now, any adult couple in California can register as a domestic partnership.

Why do couples choose to stay unmarried?

Beyond the many personal reasons why a couple might choose to remain unmarried, there could be financial or legal issues to consider. Couples later in life who have already accumulated their own wealth or those with blended families may elect to skip the marriage aisle the second time around. Other couples cite liability for their partner’s debt or worries about their high medical costs in retirement, as reasons to remain unhitched.

Why would you register as a domestic partner instead of getting married?

Domestic partnership in California affords all rights of marriage, such as access to health insurance, hospital visitation and next-of-kin survivorship rights. Also included are the right to change your last name, apply for any state-level benefits available to married couples, adopt children together, and even claim community property. Domestics partners must file joint CA returns, go to family court to dissolve their partnerships and even pay spousal support if ordered. At the same time, domestic partners can continue to receive Social Security, pensions, and other federal benefits if these are related to an ex- or deceased spouse. Many of these benefits would be lost in the event of a remarriage.

Beyond the pro’s and con’s, there are notable differences between domestic partnerships and marriage, and these should be considered based on personal circumstances in consultation with your tax preparer and attorney. The major differences between domestic partnership and marriage fall on the federal side of the equation and include exclusion from all federal tax and estate-related rights, such as IRA spousal rollovers, joint federal filing, unlimited marital deduction, as well as other benefits, such as spousal pension and Social Security benefits and more.

Despite a large number of exclusions, domestic partnership may be the right fit for the right client. Talk to your advisor for more information.



Please remember that past performance may not be indicative of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the  future  performance  of  any  specific  investment,  investment  strategy,  or  product (including  the  investments  and/or  investment  strategies  recommended  or  undertaken by Private Ocean,  LLC [“Private  Ocean”]),  or  any  non-investment  related  content,  made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated  historical  performance  level(s),  be  suitable  for  your  portfolio  or  individual situation,  or  prove  successful.    Due  to  various  factors,  including  changing  market conditions  and/or  applicable  laws,  the  content  may  no  longer  be  reflective  of  current opinions  or  positions.    Moreover,  you  should  not  assume  that  any  discussion  or information  contained  in  this  blog  serves  as  the  receipt  of,  or  as  a  substitute  for, personalized investment advice from Private Ocean.  Please remember that if you are a Private Ocean client, it remains your responsibility to advise Private Ocean, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/ evaluating/ revising our previous recommendations and/or services, or  if  you  would  like  to  impose,  add,  or  to  modify  any  reasonable  restrictions  to  our investment advisory services. To the extent that a reader has any questions regarding the applicability of any  specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Private Ocean is  neither  a  law  firm  nor  a  certified  public  accounting  firm  and  no  portion  of  the  blog content should be construed as legal or accounting advice. A copy of the Private Ocean’s current written disclosure Brochure discussing our advisory services and fees is available for  review  upon  requestor  at Please  Note: Private  Ocean does not  make  any representations  or  warranties  as  to  the  accuracy,  timeliness,  suitability, completeness,  or  relevance  of  any  information  prepared  by  any  unaffiliated  third  party, whether  linked  to Private  Ocean’s web  site  or blog  or  incorporated  herein,  and  takes  no responsibility   for   any   such   content. All   such   information   is   provided   solely   for convenience  purposes  only  and  all  users  thereof  should  be  guided  accordingly. Please Also  Note: If  you  are  a Private  Ocean client, Please  advise  us if  you  have  not  been receiving account statements (at least quarterly) from the account custodian.