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Could Getting Married Cost You Government Benefits?

Now that the right to marry has been extended to all people, it’s tempting and understandable for many couples to rush to tie the knot. We’ve previously discussed how many standard estate planning documents may need to be altered or created when a couple gets married.

But planning for marriage goes beyond just altering documents. It also requires consideration of the financial ramifications of some common benefits that could change, something which all couples now need to consider.

Combined Income Can Cause Problems

It’s a sad reality that no matter what your orientation, sometimes couples need to consider money when it comes to marriage.

A recent article correctly points out that when a couple gets married, many government benefits that are income-based and that consider spousal income or contributions to the household expenses could be lost. Like heterosexual couples, gay couples need to seriously consider the difference between single income and dual income.

For example, Medicaid, which is given to lower income individuals, may be lost when someone marries, because the combined income may end up disqualifying them from benefits. And the threshold for benefits is very low, meaning even if you marry someone with modest income, your combined income could still be too high to receive benefits.

Housing subsidies such as Section 8 or other rental assistance programs, and Social Security income, could all be affected as well. Likewise, benefit programs that may help pay for assisted living for seniors can be lost.

Those who may have been planning for bankruptcy could find that their newly combined household income makes that more difficult, if not impossible.

Many government assistant programs, such as the Making Home Affordable Program that assists borrowers in foreclosure, as well as government income-based student loan repayment programs, all are based on household income—not just the income of the borrower. Getting married could disqualify people from these programs, or increase their cost.

Take Inventory of Your Situation

Remember that many of these programs take into account your spouse’s income, even if he or she doesn’t actually spend it to help with bills. In other words, if he or she blows paychecks on shopping, and doesn’t contribute to helping with expenses, the income still counts as far as qualifying for government programs.

Before jumping into marriage, it’s important to take inventory of the benefits that you may be receiving or expected to receive from any governmental programs, and assess which programs will take into account your new spouse’s income in calculating your benefits.

Even private programs—such as, for example, a church or temple fee-waiver program for those with financial hardship, or a private-school tuition waiver for children of families with low income—can be affected by getting married.

Major life decisions require consideration of finances and attempts at making your money go as far as possible. Contact Tampa business and probate attorney David Toback to discuss your needs and make sure you understand how life decisions can impact your assets and estate.

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