Waldlaw Blog

Thursday, August 29, 2013

Today's Marriage Recognition Rulings (UPDATED 8/30)

In a press release issued today, the IRS has let it be known that all marriages of same-sex couples will be honored by our federal government for tax purposes, as long as the marriages were validly entered into by the law of the place of celebration.  What this means, in practical terms, is that a same-sex couple that marries in any of the states where such marriages are legal will be treated by the IRS as married, regardless of where they live. 

So, for example, my friends who live in Florida but married in Vermont this summer are now considered married by the IRS, even though Florida does not recognize their marriage.  They will need to file their federal taxes as either "married filing jointly" or "married filing separately," while presumably continuing to file their state taxes as single.

Domestic partnerships and civil unions will not be treated as marriages by the IRS.

In a companion ruling, which will be extremely helpful to married gay elders, Health and Human Services has issued its determination today that they will be using the "place of celebration" rule for Medicare.  Among other things, this will assist gay seniors enrolled in a Medicare Advantage plan.  Medicare beneficiaries enrolled in Medicare Advantage plans are entitled to care in the same skilled nursing facility where their spouse resides (assuming they meet the conditions for skilled nursing facility coverage and other Medicare requirements).  Gay seniors with Medicare Advantage had previously faced the challenge of being placed in skilled nursing facilities away from their spouses, given the non-recognition of their marriages.  This will no longer be the case.

UPDATE 8/30/2013:

A colleague in Virginia reports this morning that she has spoken with a supervisor at the Virginia Department of Taxation, who informed her that married same-sex couples in Virginia will be expected to file their Virginia state tax returns as "married filing jointly" or "married fling separately" regardless of Virginia's strong public policy against recognizing the marriages of same-sex couples.  The reason: Virginia, like many states, has a state law requiring Virginia residents to file their state taxes in the same manner as their federal taxes.  So filing state taxes as "single" and federal taxes as "married" would violate Virginia's state tax laws.

Many historically conservative states (e.g. Ohio) have comparable tax laws, so it will be interesting to see how this plays out.  For now, same-sex married couples living in non-recognition states will need to check their state tax codes - or consult with knowledgeable tax attorneys or CPA's - to make sure they are filing correctly.


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