DOMESTIC PARTNERSHIP AGREEMENTS: 10 THINGS TO THINK ABOUT

1. BACKGROUND INFORMATION
   1. Prior marriages (obligations from prior relationships)
   2. Prior children
   3. Want children?
   4. Health issues
       

2. SEPARATE PROPERTY

   1. Separate Property Defined

                   i.      Property acquired by gift or inheritance

                   ii.      Compensation for personal services

                   iii.      Retirement or pension benefits

                   iv.      Income derived from separate property

                   v.      The proceeds of the sale of separate property

                   vi.      Property acquired in exchange for such property or acquired with the proceeds of the sale of separate property

                   vii.      Interest in family business

2. Identified in DPA

3. Remain separate or become joint (tax consequences)?

3. JOINT PROPERTY – TAXES, TAXES, TAXES!!

   1. Ownership creates tax issues:

                    i.      Estate tax

                    ii.      Allocation of mortgage interest deduction

                    iii.      Real estate taxes

                    iv.      Income tax on income generating joint property

                    v.      Taxes on sale of joint property

2. Your choice:

                    i.      No property acquired during the domestic partnership is to be treated as joint property OR

                    ii.      All property they acquired during their domestic partnership, unless falling within the definition of separate property, should be treated as joint property

3. Separate property of a party can be reclassified as joint property only by a writing executed by the owner of the separate property

                     i.      GIFT TAX

                     ii.      Who gets it at dissolution

4. DAY-TO-DAY LIVING EXPENSES (food, clothing and entertainment),
   1. Checking account for household and living expenses – funded in proportion by both may avoid gift tax issues and makes life easier
       

5. INVESTMENTS
   1. Section 529 plans (college savings plans)
   2. Life insurance
   3. Retirement plans
   4. Brokerage accounts
       

6. THE PRIMARY RESIDENCE

   1. Are costs of purchasing to be:

                     i.      Shared by the parties as they may later agree (not recommended)

                     ii.      Shared equally

                     iii.      Paid solely by one party

                     iv.      Shared unequally, with the amounts or proportions to be specified in the Agreement

2. How should title be held:

                      i.      As joint tenants with rights of survivorship

                      ii.      Based on contributions vs. specific percentages

                      iii.      As tenants in common without rights of survivorship to the surviving partner

                      iv.      Solely by one party

3. Furniture, furnishings and other household effects – separate or joint property?
    

7. CHILDREN

   1. Do the parties intend to have children:

                      i.       By birth

                      ii.       By adoption

                      iii.      Foster children (prior to adoption)

2. Agreement should expressly state the intention of the parties to have children

3. Religious training?

4. Intention to complete second parent adoption

5. Who will pay child support in the event of a termination of domestic partnership

6. Special circumstances: the children are to reside with the parties [or expressly are not to reside with them other than reasonable visitation]
    

8. PROPERTY DIVISION IN THE EVENT OF TERMINATION OF DOMESTIC PARTNERSHIP

   1. Who gets to stay in the primary residence

                      i.      How is property to be sold if neither can (or wants to) stay

2. Who has to pay whom for what – how to value services of stay-at-home parent

3. Retention of sperm, embryos

9. RIGHTS UPON THE DEATH OF A PARTY
   1. All documentation should be consistent: wills, trusts, DPAs.
       

10. MISCELLANEOUS
    1. Medical insurance and expenses
    2. Life insurance
    3. Long term care insurance
    4. Care and support of parents of the parties
    5. Independent representation
    6. Financial statements – proper disclosure
    7. Disputes to be resolved by mediation or arbitration
    8. Change in financial circumstances