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Federal Taxes for Married Same-Sex Couples

What gay and lesbian couples need to know about filing federal taxes

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A New York Lesbian Wedding

Married couples, like this couple from New York, will now be able to file joint tax returns.

© Mario Tama/Getty Images
Updated August 31, 2013
With the repeal of Defense of Marriage Act by the US Supreme Court in 2013, same-sex married couples will now be treated by many parts of the US Government as any other legally married couple. One of the areas of government that most Americans interact with is the Internal Revenue Service. All Americans are required to file Federal Taxes. For gay and lesbian couples, this has been often been a point of contention, because, even if they were legally married in their home state, they were required to file “single” on their income taxes. Not only was this sometimes costly, it was also degrading. As of September 2013, gay and lesbian married couples will now file as “married” on their Federal Income Tax Returns.

The U.S. Department of the Treasury and the Internal Revenue Service issued a ruling in August 2013 stating that married gay and lesbian couples will be recognized as a couple by the federal government for tax purposes, even if they live in a state where their marriage is not recognized.

What does the ruling mean?

The ruling by the US Treasury Department states that in every federal tax provision where marriage is a factor will apply to same-sex couples regardless of where they live. These include federal tax filing status, employee benefits, IRA contributions, earned income, child tax credits, and income, gift and estate taxes.

For many couples, this will save them money. Depending on income, some couples will actually have a higher tax burden and will pay more in federal taxes than if they filed as single.

For example, lesbian couple who got married in Washington State, but who live in Oregon, or Idaho or any of the other 37 states where same-sex marriage is not recognized will now be able to file a joint federal tax return.

Same sex couples can get married in California, Connecticut, Delaware, Iowa, Maine, Maryland, Massachusetts, Minnesota, New Hampshire, New York, Rhode Island, Vermont, Washington and Washington, DC and live any where in the US and their marriage will be recognized by the federal government.

Treasury Secretary Jack Lew said in a statement that the change “assures legally married same-sex couples that they can move freely throughout the country knowing that their federal filing status will not change.”

What about state returns?

Each state has different rules about how it handles taxes, but Tonya Moreno, About.com’s Guide to Tax planning reports that 13 states currently allow same-sex couples to file jointly. It’s always a good idea to check with your local tax authority if you are unsure.

What about couples who have been legally married for years? Is the ruling retroactive?

Yes! Same-sex couples married before the DOMA ruling will have the option of filing amended returns for 2010-2012, but are not required to do so.

What about domestic partnerships and civil unions?

The IRS will only recognize couples who are legally married. Couples who have a domestic partnership, civil union or any other form of relationship recognition will not be treated equally as far as the IRS is concerned.

Will the ruling cover other federal taxes, like estate taxes?

Yes. Edie Windsor took her case to the US Supreme Court because she felt it was unfair that she was taxed on her “inheritance” after her wife Thea Spyer died. The couple, who had been together for 40 years were married in Canada in 2007. In 2009 their home state of New York began recognizing same-sex marriage. Spyer died that year. Because of DOMA, when Thea died, Edie Windsor was hit with a massive federal estate tax-—something heterosexual married couples would not have been subject to.

Edie Windsor issued the following statement about the new tax ruling:

The Obama administration has taken another step toward equality today by ensuring that legally married gay couples can no longer be discriminated against for federal tax purposes. The reason I brought my case against DOMA all the way to the U.S. Supreme Court was because of a massive estate tax bill I received from the federal government after my beloved spouse, Thea Spyer, passed away. Thanks to today’s ruling at the Treasury Department, no one will have to experience the pain and indignity that I went through, ever again. I feel so proud and grateful to my country and to our president.

What about same-sex couples married in Canada or other places where same-sex marriage is legal?

Yes. Amy Ruiz, from Basic Rights Oregon confirms, “That's my understanding - the IRS's announcement specifically called out legal marriages in foreign countries.”
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