Depending on when you were born you know Bruce Jenner one of two ways – the Olympian from the 70s, or the underappreciated husband of momager Kris Jenner and father-figure to the Kardashian Klan. Either way, Bruce is now Caitlyn Jenner, and she is now running of office. Caitlyn recently released an ad about how she is running for Governor of California. We thought we would discuss how an estate plan changes when a person goes from being one gender to another.
Here are some things to keep in mind when an estate plan needs gender modification.
First, lets talk about the change in a person’s name. All estate planning documents were under the Bruce Jenner name. Although her social security number does not change, Caitlyn will have to file the simple Name Change forms that apply in divorce, marriage or other scenarios, to notify Social Security of her new name. The Social Security office will in turn notify the IRS.
It is important to note that the Social Security Administration will not revise beneficiary forms on life insurance policies, retirement accounts or anything else. An advisor or attorney would be the one to help make those changes.
To go along with the name change, all identification will need to be changed – driver’s licenses, passports and any other forms of ID used.
One way to look at this situation is to “bury a client and retire another.” What we mean by that is it would be smart for Caitlyn’s advisors to recalculate cash flow as though they were burying Bruce Jenner and all his endorsements, appearance fees and any other performance-contingent income – including residual checks for the Kardashian reality show. Handle it as though Bruce Jenner has passed away and his beneficiary is Caitlyn Jenner.
The liquid assets transfer to Caitlyn, who basically inherits everything except the career. This includes bank accounts from the Kris Jenner divorce, and the $2.5 million received for giving up stake in the family homestead. From a planning point-of-view, the old client is dead and the new one is a 65-year-old retired woman.
People who are deciding to have gender reassignment also have a way to protect themselves during their transition. There is form called the Certification of Identity. It states that a person will be known by two different names during this process. This way Caitlyn does not need to answer to “Bruce” but in an emergency the papers can still be valid across both identities.
Now it is time to update estate planning documents. There may be several changes necessary, or there may only be a need to change the name on the forms. You never know. Depending on whether it is an Irrevocable or Revocable Trust will affect what changes need to be made. A simple amendment may suffice in the case of someone less famous, but due to Caitlyn’s fame and income, changing estate planning documents may become more complex.
Caitlyn may feel strange about using a trust that is under her old name. If that is the case she may decant (modify) her Trust, or she may revoke her Trust and create a whole new one.
This, like many estate planning issues, can be complicated. But a knowledgeable attorney can help with all your issues. For questions about your estate plans give Hornstein Law Offices a call 818.887.9401.