On June 26, the Supreme Court issued a landmark decision in United States v. Windsor, ruling that Section 3 of the Defense of Marriage Act (DOMA) is unconstitutional. If a couple legally weds in a jurisdiction that allows same-sex marriages, the federal government cannot deny that couple the same benefits (and burdens) that are granted to other married individuals. The decision did not go so far as to prohibit states from defining who can be married in that state; instead, holding that if there is a legal marriage, the federal government cannot ignore that union.
The Supreme Court ruling left open the question as to who would be recognized as married for federal tax purposes. In late August, the IRS issued Revenue Ruling 2013-17, which clarifies that same-sex individuals who are married under state or foreign law are considered married for federal purposes regardless of their current state of residence. For federal tax purposes, the term marriage does not include registered domestic partnerships, civil unions, or other similar formal relationships recognized under various state laws that are not denominated as a marriage under that state’s law.
The IRS ruling will be applied prospectively as of Sept. 16, 2013. Legally married same-sex couples generally must file their 2013 federal income tax returns using either married filing jointly or married filing separately status. For tax year 2012, married same-sex couples who file an original return on or after Sept. 16, 2013, generally must file as married filing jointly or married filing separately. They no longer have the option to file as single.
Returns for prior years that are still open for statute of limitations purposes can be, but do not have to be, amended. Refund claims may be filed for 2010, 2011, and 2012.
The Social Security Administration recently issued guidance stating, for purposes of determining entitlement to Social Security benefits, claims can be paid when the number holder (i) was married in a state that permits same-sex marriage, and (ii) is domiciled, at the time of application or while the claim is pending a final determination, in a state that recognizes same-sex marriage. However, other federal agencies have adopted rules similar to the IRS. For instance, before she recently left her role as secretary of the Department of Homeland Security, Janet Napolitano said when considering an immigrant visa petition for a same-sex spouse, US Citizenship and Immigration Services looks to the law where the marriage took place when determining whether it is valid for immigration law purposes. The State Department’s Bureau of Consular Affairs announced a similar position on its website.
Same-sex couples should consult with their advisors in making any determinations with respect to tax returns and government benefits.
For more information or any questions you might have on this topic, please contact your Baker Tilly advisor or send an e-mail to firstname.lastname@example.org.