High court strikes down federal marriage provision, clears path in California

[kcjenkins]

The Supreme Court ruled Wednesday that legally married same-sex couples should get the same federal benefits as heterosexual couples. The court invalidated a provision of the federal Defense of Marriage Act that has prevented married gay couples from receiving a range of tax, health and retirement benefits that are generally available to married hetrosexual couples.

Also Wednesday, the court cleared the way for same-sex marriage in California by holding that defenders of California's Proposition 8 gay-marriage ban did not have the right to appeal lower court rulings striking down the ban. The court's 5-4 vote Wednesday leaves in place the initial trial court declaration that the ban is unconstitutional. California officials probably will rely on that ruling to allow the resumption of same-sex unions in about a month's time. The high court itself said nothing about the validity of gay marriage bans in California and roughly three dozen other states.

[kcjenkins]

This is going to lead to some interesting tax situations, it seems to me. Do CA preparers need to get ready to file a lot of amended returns?

[Guest Taxed]

Does the decision say how soon the Feds have to recognize same sex marriages for Fed law purpose?

MA allows same sex marriages and I file a joint state return for a few of my same sex couples and then within the software I have to split it and file 2 single Federal returns. It takes a little bit of effort.

[Jack from Ohio]

I would expect it to be retroactive to when DOMA was passed into law. Looks like the opportunity for MANY amended returns.

I have no position on the moral implications of the bill and the accompanying social effects. My only reason for paying close attention is to provide tax services to any of my clients these law changes affect.

I do not understand why a tiny percentage of the population is able to drive society and our Government into such a costly frenzy.

[michaelmars]

i have a few 706's that might have to be amended but I don't think many of my clients will want to amend their 1040's unless the tax difference is a large number.

[Guest Taxed]

Hopefully IRS will soon give us some guidance on this matter. I am thinking of one of my same sex couple who will get their student loan deduction back if they filed MFJ instead of single. I think those of us in states that recognize same sex marriage will have to review our client list of same sex couples and determine how the amendments would benefit our clients.

The question is if it is retroactive all the way back to passage of DOMA will IRS allow more than 3 previous year amendments?

[joanmcq]

No, you'd have had to file protective claims to keep the statute open to file back more than 3 years. It looks like the ruling will take hold in 25 days, per Lambda Legal's website. I haven't had a chance yet to read the full decision or all of Lambda's FAQs on tax implications.

[Guest Taxed]

So if a taxpayer files a protective claim can they then amend back all the way to 1996 the year Doma was enacted??

[joanmcq]

No, because no states recognized same sex marriages back in 1996. The ruling basically states that marriage is defined at the state level, and the federal government cannot create a discriminated class of marriages that are recognized by the states.

A protective claim had to be filed before the statute tolled for amending the returns. I was filing 2009 claims this year. CA claims won't run any farther back than 2008.

[SaraEA]

Jack, I don't think a tiny percentage of the population was allowed to throw everyone into a frenzy. The Supreme Court case had nothing to do with same-sex marriages per se. My understanding is that it had to do with states' rights--an issue appropriately decided by our nation's highest court. The Constitution limits the powers of the federal government, ceding to the states authority to create most public policies and allowing the central government the power to do things the individual states can't (e.g., declare war, interstate commerce) . States have traditionally defined marriage and passed their own rules governing it. When I was a kid, it was popular for young couples to elope to Las Vegas, which didn't have the requirements for blood tests and waiting periods most other states did.

George W Bush started a trend of usurping for the federal gov't powers that traditionally belonged to the states (Obama has certainly carried his torch). The Defense of Marriage Act defined marriage for federal purposes as between a man and a woman. The feds essentially took from the states their traditional power to regulate marriage. Today the Supreme Court said the feds can't do that.

In my opinion, the federal gov't has been stepping on states' rights with the power of the purse. For example, public education has long been a state function. By giving the states a little bit of education money, with fat strings attached, the feds have essentially taken over local jurisdiction of education policy. Same with food stamps, medicaid, etc. Do it our way or don't get our financial help. Thus areas that have always been under state power have been handed over to the feds--who are setting state policies by telling them you can do whatever you want but if you wander from our desires you get no money. Most states have no choice but to comply.

I live in a state where same-sex marriage is legal. Like other posters, I have to file them as single for the federal return and either MFS or MFJ for the state. I don't have a lot of these clients, and I'm going to wait for guidance before I start doing amendments. Yet I do applaud the Supreme Court for finally taking a stand that our Constitution does not permit the federal government unlimited powers.

[jainen]

>>I do applaud the Supreme Court for finally taking a stand that our Constitution does not permit the federal government unlimited powers.<<

Well, there were TWO rulings today. Besides DOMA, there was California Proposition 8, which was passed by a majority of voters and outlawed gay marriage. When one court over-ruled the voters, the state government refused to defend the election so private citizens appealed. The Supreme Court did not even talk about marriage; they just said private citizens can't do that. So in that case the Supremes supported the power of government over individual citizens and the democratic process.

[Guest Taxed]

I think the SC did not want to rock the boat too much at this point knowing 2016 is just around the corner. I am looking forward to the 2016 debates. We have immigration, Obamacare, same sex marriage and abortion issues brewing and let's see how the country votes.

I must salute Ms. Wendy Davis state sen. TX. She is a brave woman and we need 100s of women like her in every state legislature.

[michaelmars]

another issue is insurance. Now that same sex marriages are legal will insurance companies in those states, stop offering domestic partnership policies? after all they can now say if you want to be covered as married, get married. It could be a boon to them by reverting those policies back to single from married coverage.

[joanmcq]

IMHO most couples became domestic partners because they couldn't marry. Now there won't be imputed income because the same-sex spouse is covered.

[Guest Taxed]

Joan are you also hearing that after 25 days from the date of the decision we should be able to submit 1040X where applicable. The IRS site says they will come up with guidance but no ETA?

[jainen]

>>The IRS site says they will come up with guidance<<

25 days is the normal time for a Supreme Court ruling to take effect. It will be substantially longer for the IRS to provide interpretation and guidance because that will also be subject to dispute. Remember, the Supreme Court did NOT say gay marriages are legal. It said (in one case) the federal government can't over-rule states, and (in the other case) it said the federal government can over-rule states.

Here's one example of the big problems still to be worked out. A couple get legally married in California, then move to Alabama where the marriage is not legal. Anybody want to guess?

[Guest Taxed]

>>>Here's one example of the big problems still to be worked out. A couple get legally married in California, then move to Alabama where the marriage is not legal. Anybody want to guess?<<<

That is where the next legal battle will be fought. Different states with different rules. Sooner or later this will again reach the SCOTUS and this time it can't punt!