Inheritance Rights of Transgender Clients

Estate Planning for Transgender Clients Part II

LBGT Pride

An issue for transgender people is how an individual’s own perception of their gender and how he/she lives in the world will be impacted by illness or death. Will that individual’s identity be respected when the person becomes incapacitated or incompetent because of an illness or accident? Will the person be able to inherit from family members if the name and appearance do not match the name in a relative’s will?

Power of Attorney and Medical Directive
If a transgender person has a family of original who opposed his or her transition, it is imperative that the transgender person has a power of attorney in place and a medical directive that clearly states who is to make decision about care and treatment, including issues about gender identity and allows this person to have access to information that may be restricted by HIPAA (the Health Insurance Accountability and Portability act of 1996).

In a power of attorney and medical directive, the principal can make statements to prevent erasures and insist on the appropriate use of names and pronouns to be consistent with gender identity, even if they have not legally changed a name or other identity documents.

Confusion About Who Inherits
Usually, ambiguities in wills and trust are resolved by reference to the intention of the person who made the will or trust.

Often, there is a mistake or something that doesn’t agree with the facts or confusion.

Let’s look at an example. Let’s say William Jenner dies and his will says he gives 50% of his estate to his son, Bruce Jenner. Bruce Jenner is now Caitlyn Jenner. Does Caitlyn inherit? Is the female Caitlyn Jenner the same person as the male Bruce Jenner?

The answer is not obvious.  On one hand, these two identities occupied the same body and would seem obvious to be the same person. The question is, did William Jenner intend to give hi 50% of his estate to Caitlyn Jenner?

One can easily imagine that in a hostile family situation, a disgruntled sibling could say that “Dad never accepted Bruce’s transition and refused to acknowledge the existence of Caitlyn.” Does that matter?

Conditions on Inheritance
What if Bruce/Caitlyn’s parents were unhappy with her transition, and in their wills said that as long as Caitlyn was a female and not their son Bruce, she could not inherit? Is such a condition void against public policy in the same way that the law would not enforce a condition say, that a daughter could only inherit if she divorces her husband. 

In general, conditions that place restraints on marriage, that promote divorce, that imposes conditions about the practice of a particular religion, requires the destruction of property or promotes illegal activity will not be enforced.

If a condition about transgender status were found to be enforceable, what criterion would be used to determine if the condition has been met? As long as Bruce/Caitlyn did not have reassignment surgery, does that satisfy the condition of being male?

If Bruce/Caitlyn does not legally change her name, birth certificate, and other identity documents, does that suffice?  

Obviously, the best solution is for William, the father, to be precise in his will to eliminate any possibility of an argument or a misinterpretation. But people don’t change their wills very often and William may not have thought about this causing an issue.

In Closing
Now that same-sex couples have the right to legally marry, questions about the validity of a transgender person’s marriage are also solved. Clearly, the same-sex spouse or transgender spouse can inherit under the intestacy statutes, and there is no doubt about the validity of the marriage or the legitimacy of children. 

Nevertheless, it is all too common for uncomfortable family members to refuse to accept transgender people and one can expect litigation in the future over their inheritance rights.