Estate Planning and Tax Lawyer Blog

While same-sex couples can get married in the District of Columbia and five states, they are still unable to file a joint federal tax return, share their retirement benefits, protect each other’s assets from estate taxes, or benefit from multiple tax breaks provided through federal law. Because of this, married same-sex couples must do more financial planning than individuals who are not married. In 2008, there were about 565,000 same-sex couples across the United States, including an estimated 32,000 who were married.

The problem is that under the Defense of Marriage Act of 1996, same-sex marriage is not recognized by the government, even if allowed by a state government. As long as the same-sex married couples live in a state that will recognize their marriage, then many of the state-based rights will extend to them. It is recommended to sill have a health-care power of attorney naming their spouse if they travel somewhere that doesn’t recognize their marriage. Many same-sex couples end up filling out multiple tax forms since they are required to file their federal income-tax returns individually. They file individually with the federal government, a “dummy” joint federal tax return, and a married-filing-jointly state return based on the dummy federal return. This becomes very complicated.

However, the biggest problem occurs when there is a death of one the same-sex spouses. Inheritance, retirement plans, and marital deductions can all be treated differently when it comes to same-sex spouses because the federal government does not recognize the marriage.

To read more on this article, visit Headaches for Same-Sex Couples.