As of 2007, California affords registered domestic partnerships (RDP) all of the same rights and responsibilities as marriages under state law. The laws pertain to same-sex couples (and couples where one partner is at least 62 years of age). Parts of the law are fraught with uncertainty. There are several issues which are known, and several unknown.

Same-sex couples will need to carefully analyze the aspects of their individual relationships to decide if California Domestic Partner Registration is best for them. There are several property and ownership issues that should be addressed prior to registration. Becoming a Domestic Registered Partner is a personal decision for each couple based on a number of factors. Speaking to a qualified attorney can help you make the decision whether registering would be fiscally prudent for you and your partner.

The new law equates RDPs to married couples for purposes of California law, but not Federal tax law. Where ever the word "spouse" is used in California law, the word will implicitly include RDP.

The Family Code states that all property acquired (other than by inheritance or gift) after marriage (registration) and all assets collected from earned income are equally owned, regardless of the manner in which the account, asset or deed is titled. The rules of community property apply to all interests in property including but not limited to real property, businesses developed, savings accounts, stock options and accounts, and pension or IRA benefits accrued.

Along with the benefits of being a married couple, RDPs must also take on the liabilities. Starting with the 2007 tax year, there is an obligation to file state tax returns as a married couple. Community property rights also include community property liabilities such as community property debt. In the event of a dissolution, a family law court judge will determine the eligibility and amount of post-separation spousal support the lesser-earning partner will receive.

Because RDPs aren't married, they do not qualify for the unlimited marital exclusion from the gift and estate taxes. However, up to $12,000 of gifts that one partner makes to the other each year are tax-free under the annual gift tax exclusion. After that, taxpayers begin to use up their unified credit, which exempts $2 million from estate taxation or $1 million from gift taxation (see Federal Transfer Tax)

The gift tax doesn't apply to payments of another person's tuition made directly to a school or to payments of another person's medical expenses made directly to a medical care provider. Thus, such payments can be made on behalf of domestic partner without incurring gift tax liability.

Despite the unlimited marital deduction not being available for RDPs, there are planning strategies historically inherent to married couples that may be desirable for affluent unmarried couples. For example, the use of a properly drafted and administered bypass trust will avoid the trust property being taxed in the surviving partner's estate.

While disclaimer trusts are a useful estate planning too, in the case of domestic partners, the typical use of a disclaimer trust is not an option, because only a spouse can make a qualified disclaimer that results in property interests passing to the person making the disclaimer. However, if the estate is substantial, a disclaimer might be desirable if the intent is for the interest in the property interest to pass to someone other than the disclaiming partner.

Being married does not preclude the necessity for opposite-sex couples to formulate estate plans for the asset protected transfer of wealth or limiting taxation. Nor should registering as domestic partners deter you from formulating a comprehensive estate plan to protect your assets and your family (see Overview of Estate Planning). Whether you are single, in a committed relationship, registered or not, there is no substitute for a sound estate plan.