Tax Season
3:30 pm
Wed January 1, 2014

Same-Sex Married Couples Can Reap More Benefits This Tax Season

The U.S. Supreme Court’s striking down of the Defense of Marriage Act (DOMA) might have same-sex married couples worried about what changes are in store for them this tax season. But Joseph Nicola of Sisterson & Co., a Pittsburgh accounting firm, says filing shouldn’t be any more difficult than last year.

Nicola said the Supreme Court case United States v. Windsor means that married same-sex couples can take advantage of more benefits.

According to the Oyez Project, a Supreme Court tracking venture of the Chicago-Kent College of Law, the case was brought before the court after Edith Windsor’s spouse, Thea Clara Spyer, died in 2009. Windsor and her spouse were married in Toronto and their marriage was recognized by New York state law (where they lived).

When Spyer died, she left her estate to Windsor but, because the marriage wasn’t recognized under DOMA, the government imposed $363,000 in taxes. Had their marriage been recognized, no taxes would have been levied. Windsor then filed suit seeking a declaration that DOMA was unconstitutional.

Nicola said the biggest change is that same-sex married couples will be able to file jointly on their federal taxes.  He said those couples are also entitled to benefits on retirement plans, pensions, IRAs and tax free employer health coverage which, under federal law, is available to employees’ spouses and dependents.

Nicola said the IRS is taking a “place of celebration” approach to filings.

“So as long as the individuals are married in a state or country that recognizes same-sex marriage, then they’re entitled to these benefits regardless of where they live,” Nicola said.

This means that a same-sex couple married in Massachusetts or New York will be federally recognized as married when living in Pennsylvania.

Nicola said it shouldn’t be difficult to file jointly this year, and most tax software can handle it.

“The only difference between a joint return and a single return is the fact that you are essentially including twice the information,” said Nicola. “But all the complex tax calculations are essentially done by the software.”

This July state Attorney General Kathleen Kane made headlines when she refused to defend Pennsylvania’s 1996 law that defines marriage as between a man and a woman, which is currently facing a challenge in federal court.