30 Aug Victory – Married Same-Sex Couples Gain Equal Tax Benefits
Victory! Married Same-Sex Couples Gain Equal Tax Benefits
Two months after the Defense of Marriage Act was struck down, the Treasury department ruled that legally married same-sex couples will be characterized as married for federal tax purposes.
This decision is critical to same-sex couples lawfully married in one of the 13 states in the U.S. or 15 foreign countries that allow it because it relates to federal taxation with respect to estate tax, gift tax, income tax and employer sponsored health and insurance benefits.
With respect to income tax, this ruling provides clearer guidance for income tax (joint) filings. It’s critical for estate tax planning because spouses can take advantage of portability of the unified credit, which is now $5.25 million per spouse. Similarly, for gift tax, spouses may gift an unlimited amount of money or property to each other gift tax free under the federal marital deduction.
Prior to two months ago, same-sex couples have had to engage in complex estate and gift tax planning and business planning, utilizing trusts and business entities, in order to achieve the same objectives of heterosexual spouses. This new law and accompanying ruling by the Treasury Department represents a major victory for same-sex couples.
Here’s a link to financial issues relating to same-sex couples:
Here’s a link to the complete article on CNN: