Same Sex Married Couples Get Federal Tax Equality

The US Treasury announced at the end of August, 2013, that same sex married couples will have their marriages recognized by the Treasury and IRS, even if they live in a state that does not recognize their marriage.

Prior to a ruling by the US Supreme Court in June 2013, the IRS did not allow same sex couples to file as spouses and gain the federal tax benefits of being married.

The initial case was brought after two women were married in a state in which same sex marriage was legal. Eventually, one of the spouses died. The IRS did not recognize their marriage, and charged the surviving spouse a large inheritance tax. The Supreme Court ruled that unconstitutional, and essentially shot down the Defense of Marriage Act as being discriminatory against a minority. The Supreme Court did not discuss what would happen in states that did not recognize gay marriage.

The announcement by the Treasury puts the federal part of that question to rest, in that the Treasury and IRS will recognize gay marriage, that was performed in a legal ceremony, no matter where the couple currently lives.

What does this mean? Nothing, if you are not married to a same-sex partner. If you are, it is great news, because no matter where you live

  • you can file your federal taxes as a married couple
  • you will not have to pay federal inheritance tax if your spouse dies
  • you hopefully will be treated as a spouse (i.e., next-of-kin) for hospital visitation

Hopefully, it won’t take long for all the state tax boards to catch up to the federal tax codes.

SCOTUS protests DOMA

6 thoughts on “Same Sex Married Couples Get Federal Tax Equality

  1. Thank God our government is coming around on this issue. The financial discrimination against same sex couples is a shame, and I’m glad our tax code is no longer punishing people for having the wrong sexual orientation.

    Here’s an idea though: stop discriminating against single people, too.

    1. @Done by Forty, I completely agree. Although I don’t have a good answer for many of the discrepancies. Currently, spouses inherit from each other with no tax. Social Security benefits also can be passed from a dead spouse to the remaining spouse. But what to do for singles? Let them choose someone to pass their Social Security benefits to before they die? That would probably break the system. Get rid of inheritance taxes altogether? I would be for that, as long as other taxes were raised in a fair manner to pay for the loss of revenue.

  2. I’m shocked that this wasn’t passed earlier. I mean, seriously, it’s not 1940. I have heard horror stories of same sex couples going through really terrible times if one passes away because the government wasn’t recognizing them as married.

    1. Thanks for the nice comment, Daisy. I am also surprised that equality is such a hot-button issue. Granted, there are not many RSS subscribers to Save and Conquer, but I lost 25% of my subscribers when I published this post. Perhaps it still is 1940. :-)

        1. @Done by Forty, I could say I was surprised, but I suppose I’m not. I’ve got several friends who are against gay rights. I have a hard time understanding how they can be nice people, yet vote against equal rights for others.

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