Legal Blog

The Weekly Scenario from Steve Shane – 12.23.13

Question: Has there been any further clarification by the IRS as to the federal tax consequences of same-sex marriages after the Supreme Court’s ruling in Windsor? Answer:  A couple months ago, I told you about the recent Windsor case, in which the Supreme Court found that a portion of DOMA (the Defense of Marriage Act) was unconstitutional.   The Court’s ruling had far-reaching implications for a number of federal taxes, such as income, estate and gift taxes. More recently, the IRS clarified two important issues: 1. A same-sex couple will be treated as married for federal tax purposes so long as their marriage was valid in the state or foreign jurisdiction where it took place (even if the couple is currently domiciled or residing in a state that does not recognize same–sex marriage).  Note that same-sex marriage is recognized in only about 1/3 of states. This is the IRS position but not necessarily the position of other federal agencies like the Dept of Labor or Social Security Administration, who actually do not subscribe to this viewpoint (they look to the then current domicile of the individuals). 2. The recognition of marriage for a same sex couple does not extend to domestic partnerships (registered or not) or other civil unions. Same sex couples who want to be treated as married for federal tax purposes will have to marry in a state that permits same-sex marriage. For tax year 2013 and future years, a same-sex married couple must file their federal income tax return as either married filing jointly or married filing separately.  The filing status as single will not be permitted (keep in mind that filing as unmarried may still be required in the state where the couple resides if that state does not recognize same-sex marriage).  Spouses who were legally married in prior years may amend prior year filings if they determine doing so will reduce their income tax in the prior year and the statute of limitations is still open for the prior year. This ruling and the accompanying regulations which follow have other tax implications which we can address.  I will continue to bring you periodic updates. Steven E. Shane Principal Offit│Kurman Attorneys At Law 301.575.0313 Washington 410.218.9339 Mobile 301.575.0335 Facsimile Please note the above material discussed is intended to provide only general information. Do not, under any circumstances, solely rely on this information as legal advice. Legal matters are often complicated. For assistance with your specific legal problem or inquiry please contact me directly.