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Supreme Court Rules on Same-Sex Marriage

June 30, 2015

Same Sex marriage is now legally recognized in all U.S. states, leading to a number of tax and estate planning changes for same sex couples.

Last Friday after a historic supreme court ruling, same-sex marriage became legal nationwide. For individuals and businesses that reside in states that previously did not recognize same-sex marriages, there are a number of tax, estate planning, and employee benefit implications to the new ruling that you will want to be aware of.

More about the ruling

The fourteenth amendment asserts that no state shall “deprive any person of life, liberty, or property, without due process of law” which was the basis of the Obergefell v. Hodges case. 14 same sex couples and two homosexual widowers filed lawsuits in their home states, saying that their 14th amendment rights were violated. Some of these couples were denied the right to marry and others were legally married in other states but not recognized as such in their home states.

In the historic 5-4 ruling, the Supreme Court decided that under the 14th amendment:

  • All states are required to issue marriage licenses to any same-sex couples.
  • All states must recognize a same-sex marriage lawfully performed out of state.

How the Ruling will affect Finances

The ruling will affect taxes of many same-sex couples who, by both state and federal law, were subject to conflicting tax treatment of their marital status. The 2013 Windsor SCOTUS decision authorized federal recognition of same-sex marriage, but not state. Other new financial opportunities for same-sex couples include:

  • All same-sex married couples will be able to enjoy the benefits of joint tax filing and estate planning to cut costs and protect financial futures for themselves and their families.
  • All same-sex married couples will be able to file income taxes as a couple.
  • No couple will have to run off to another state to get married for tax reasons.

Other Changes

Some businesses have expressed relief in that they will no longer have to deal with the complexities that come along with filing an applicable employee as married for federal purposes, but not state purposes. The human resources benefits administration in many businesses is expected to be simplified with the ruling. Questions? Contact us.

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