Gay Man Adopts His Partner to Avoid Inheritance Tax

June 28, 2013— -- John met Gregory at a gay bar in Pittsburgh nearly 45 years ago and immediately fell in love. Today, the couple has weathered the early days of the gay rights movement, the death of friends in the AIDS crisis and constitutional laws in their home state of Pennsylvania that have prevented them from marrying.

Now, as lifelong partners facing the financial and emotional insecurities of old age, they have legally changed their relationship and are father and son -- John, 65, has adopted Gregory, 73.

The couple was worried about Pennsylvania's inheritance tax.

"If we just live together and Gregory willed me his assets and property and anything else, I would be liable for a 15 percent tax on the value of the estate," said John. "By adoption, that decreases to 4 percent. It's a huge difference."

Because John's dad is still alive at 95, he could not legally have two fathers. So Gregory, though older, became the adopted son. The Daughin County Court judge who signed their papers was adamant in telling them that the adoption was "forever" and they would never be able to legally marry.

John understands people might think it odd that a 65-year-old would adopt a man eight years his senior. (The men asked that their last names not be used; "Gregory"'s first name has been changed too.)

"It's humorous to me," he said. "Gregory was a high school and college jock. Today, I am making dough for blueberry crostata and he is golfing. You're going to think of him as the dad, rather than me. … But it provided us with some level of comfort that we have protected each other as much as we can."

Same-sex couples celebrate DOMA's demise.

This week, the Supreme Court passed its landmark decision on the Defense of Marriage Act (DOMA), allowing same-sex couples who are legally married to receive the same federal marital benefits as heterosexual ones -- inheritance tax breaks and Social Security survivorship, among more than 1,000 others that pertain to marital status.

And Proposition 8, which banned previously legal gay marriage in California, was overturned.

But for those who live in states where gay marriage is not recognized or legally outlawed, there are still obstacles to equality. John and his partner live in Pennsylvania, where a state DOMA law restricts marital benefits to a man and a woman.

"As tremendous as the victory was at the Supreme Court, it was a victory half-finished," said Janson Wu, a lawyer for the Boston-based Gay & Lesbian Advocates and Defenders. (GLAD).

"There are still over 30 states where couples are denied the ability to protect their families," he said. "What you see with [John and Gregory], unfortunately, is what so many couples are still being forced to do. They think of creative ways to ensure protection for each other to make medical decisions and inherit property after one has passed away."

The couple's adoption, first reported by the Central Voice, a Pennsylvania newspaper that serves the LGBT community, solved their future financial worries, but does not entitle them to federal benefits that now await same-sex married couples.

Wu said he had seen "a few cases" of same-sex couples resorting to adoption, including a recent one in Maine. "But this is less usual. It is really more of a relic at a time when same-sex couples had no other means to protect their families. "

In states like Pennsylvania, same-sex families still struggle with health-care decision-making and filing jointly on state taxes. In states where same-sex marriage is not legal, children are often not recognized or a non-biological parent is unable to adopt.

Sometimes, when a couple divorces or a biological parent dies, family members "try to assert legal claims to the child," said Wu.

In one notorious legal case in 2009, Lisa A. Miller kidnapped her 7-year-old daughter with Janet Jenkins, Isabella, and fled to Nicaragua. Because Virginia, where the family lived, does not recognize same-sex marriage, the law gave no rights to Jenkins.

In John's case, the couple had considered marrying in another state, but because their primary residence was in Pennsylvania, which does not recognize same-sex marriage, they would still be subjected to the inheritance law.

"We didn't have the confidence that same-sex marriage would ever be approved in the Commonwealth," he said.

John and Gregory got the idea for adoption from a 76-year-old friend Nino, who was concerned that his partner worked for a company that didn't have a pension or retirement fund. The partner's sole source of income would have been Social Security.

"If Nino predeceased him, his partner could not afford the taxes on the assets and would lose their home and be homeless," said John.

When the men met, John was a buyer for a department store and Gregory worked for the government.

"In a few years, he took a job ... and asked me to come along," said John. "I wasn't sure. I kept thinking, with a gay relationship you never know. There's always someone cuter or prettier."

But after agonizing, he joined Gregory, who has been retired for 10 years, and never turned back. Eventually, John ran an HIV/AIDS program in the state health department for 25 years, but is now semi-retired.

For years, their relationship was somewhat closeted. John said he was used to openly gay friends in the retail industry, but his family always posed a problem.

"Mine was very Irish-Italian Catholic and made me feel guilty about sex preferences," he said. "Gregory was very closeted and when his parents would come to visit -- they had a habit of dropping in -- I would have to run to the bedroom and make sure the beds were pushed apart and put a nightstand between them."

"I had panic attacks about a sibling swooping down if Gregory predeceased me," he said. "A couple of siblings are homophobic and I thought, we better get our ducks in a row."

"I made all my end-of-life arrangements," said John. "I wanted to be cremated. With my Irish-Italian family, there would have been a four-day viewing and a Catholic mass and I don't want to put Gregory through that."