Legalizing same-sex marriage is not only beneficial for same-sex couples; it will also be beneficial for the U.S. Treasury. According to the Congressional Budget Office, recognition of gay marriage will add $1 billion a year for the next ten years to the U.S. budget.
The Census Board also revealed that in the United States, there are 130,000 same-sex married couples. In total, there are 650,000 same-sex couples in the country. Currently, same-sex partners cannot file a "married filing separately" or "jointly filing" status as a married couple because federal law doesn't treat same-sex partners as married for federal tax purposes.
The Obama administration will need to determine whether to treat same-sex married couples the same as opposite-sex marriage or use a unique definition for them. In certain tax codes, the words "husband and wife" appear. The verbiage will need to be amended if same-sex married couples use those tax codes.
Moving from a Legalized State
There are only nine states, and the District of Columbia, that have legalized gay marriage. 31 other states do not allow gay marriage. Some states recognize gay marriages that took place in other states, and some provide certain legal benefits to same-sex married couples.
No one is sure whether moving from a state that has legalized gay marriage to a state that still holds the ban will mean continuance of the rights or not. It might depend on the state and the firmness of their position regarding the issue.
End of DOMA
States can expect to gain millions of dollars in revenue by legalizing gay marriage. Unmarried domestic partners pay fewer taxes than their married counterparts. The end of the Defense of Marriage Act (DOMA) will mean married gay couples will also be able to use tax breaks they previously were excluded from.
The U.S. Supreme Court is currently hearing arguments against the federal law banning recognition of same-sex marriage, arguing that the law is discriminatory. While its end will mean freedom for same-sex partners to legally marry, to enjoy the benefits and shoulder the burdens as their heterosexual couples do, it will also give a new revenue stream for the federal government and states.
Labels: Marriage and Taxes, Tax Code, Tax News, Taxpayers