The ugly reality of partial equality is setting in for newly-married couples in New York. They’ve got the girl, but many of the other benefits that come with declaring your love for the government to hear are still miles away. Due to DOMA, married same-sex couples will continue to be treated as single filers by the IRS and will face significant hurdles in the already arduous tax-filing process — even as New York begins to allow married couples to file as such. Though Obama refuses to back DOMA and has directed federal agencies to extend all possible benefits to same-sex couples, even the HRC admits that the IRS doesn’t have much of a choice — because while DOMA is still in existence, “all possible benefits” just isn’t much.
Though gay couples can file as married in New York, they wil be required to fill out additional sets of forms for federal tax returns. Extra “dummy” copies take time to figure out (consider the tax code) or an extra $300-$400 dollars if you hire and accountant. You’re also essentially lying to the IRS, although that’s what they’re asking you to do. It creates a confusing situation where your legal and financial reality varies wildly based on whether you’re looking at it on the state or federal level, and individual couples have the confusing experience of being finally validated by one entity while still being made lesser than by another, and having to deal with both simultaneously. If there’s any need at this point for concrete proof that DOMA makes no sense, it’s the way in which it requires us to put together legal documentation that is actually nonsensical in order to comply with its demands.
Employer heath benefits will also remain up for federal taxation. Under DOMA, if (and only if) companies decide to extend benefits to employees’ same-sex partners, the partners will be taxed according to the value of the benefit received. Straight spouses are not penalized. You might remember stories from earlier this year about some companies like Google and Cisco “grossing up” their partnered gay employees salaries to make up for government-mandated inequality.
Estate taxes present one of the most costly tax expenses to same-sex couples. As the 3rd most populous state in the country and the 8th richest state by income, this is bound to effect a significant number of couples in New York. While a person can leave over $5 million dollars to their different-sex spouse tax-free, a same-sex spouse would be taxed on the inheritance.
We reported yesterday on Edith Windsor’s DOMA case. She was taxed $363,000 after her wife, Thea Spyer, died in 2009 and is suing on the grounds that she was discriminated against. She’s not wrong; as much as all of this is tied up in our legal system, it’s a simple matter of discrimination. Historically, preventing wealth-building has been a way to keep minority groups powerless. A tax on being gay not only eats into our wallets, but redirects our resources toward unnecessary controversies and prevents real progress.
Just since I feel like we should leave on a happy note, I thought you might be interested to know that Americans for Truth About Homosexuality, an Illinois-based group that was recently labelled a hate group by the Southern Poverty Law Center, had its tax-exempt status revoked after failing to submit forms three years in a row.
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Thank you Laura! It’s so damn sad that we can get married now but essentially we’re still getting screwed over by the government financially, which for many is far too harsh a penalty for wanted to be married.
I read the title as “Texas most discriminatory/Least romantic…but perhaps that is because I have yet to find a ladyfriend or otherwise inclined person here. Texas has everything I want except civil rights. And by “everything I want”, I mean “breakfast tacos.”
Having suffered a painful breakup this year, I think breakfast tacos are indeed everything I want. Unfortunately, not so much of a scottish speciality…
My wife & I have been dealing with this fun aspect of taxes here in Massachusetts for 3 years now. It’s a total pain. When we file our Federal taxes, on which we have to say that we are single, we include a letter that says the following:
To Whom it May Concern,
As I submit my 2010 Federal Income Tax form, please note that I have reported myself “Single”, while my 2010 Massachusetts Income Tax form is filed “Married – Filing Jointly”. Public Law 104 – 199 (known as the “Defense of Marriage Act”) requires you, the IRS, to discriminate against my wife and me and requires us to file our taxes as single persons. We do not in any way consider ourselves single, and have not since our wedding on October 11, 2008. Please do not take our filing singly as any indication that we consider ourselves anything but legally bound to one another.
Feel free to steal, edit, and reuse this letter!
That is a fantastic letter! I want to become an AS member just so I can thumbs-up it but I have to leave for work now. Consider this a placeholder.