IRS Provides Same Sex Couples Direction, Post DOMA Ruling
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The Supreme Court’s recent decision to allow same-sex couples to receive marriage benefits raised several questions that left many lawmakers, financial institutions and individuals anxious for answers. Now, finally, the IRS has issued guidance in Revenue Ruling 2013-17. A Revenue Ruling is the IRS’s interpretation of the law.
One of the most pressing questions answered by Revenue Ruling 2013-17 the following:
How exactly does the new law impact same sex couples who live in states that do not recognize gay marriage?
The IRS has decided that it will recognize same-sex marriages nationwide regardless of where the couple resides. This is known as the “place of celebration approach.” According to the IRS, it will not recognize formal relationships under state law such as civil unions or domestic partnerships.
The place of celebration approach would work as follows: As long as a same-sex couple marries in a state that recognizes same-sex marriage, then the IRS will recognize that couple for federal tax purposes regardless of where the couple relocates.
The IRS will begin to follow the holding of Revenue Ruling 2013-17 on September 16, 2013. Therefore, for the 2012 tax year, and all prior years, same-sex spouses who file an original tax return on or after September 16, 2013 generally must file using a married filing separately or jointly filing status. If a same-sex spouse filed their tax return before September 16, 2013, they may choose, but are not required, to amend their returns to file using married filing separately or jointly filing status. Keep in mind that the benefits of filing a joint return may not always be greater than filing separately as unmarried individuals. Therefore, if you are a same-sex couple in a state that recognizes marriage, then you would want to crunch the numbers. If you’re better off filing jointly, then you may be due a tax refund.
Generally, a taxpayer may file a claim for refund three years from the due date of a return plus extensions or two years from the date the tax was paid, whichever is later. Some same-sex married couples may have filed protective claims, had a disability, or agreed to an extension all of which may extend the time to claim a tax refund.
The Supreme Court’s decision significantly impacted other areas such as retirement and health plans. The IRS clarified its position and provided guidance in Revenue Ruling 2013-17. If you have any questions about the IRS’s guidance for same-sex couples, please contact our office. The IRS is expected to issue more guidance for individuals as the 2014 filing season approaches and for employers and retirement plans. Our office will keep you posted on developments.
Attorney Todd Unger is known throughout the legal community as an expert in federal tax controversy matters. After working as a proprietary equity trader in New York, Unger pursued his law degree at Nova Southwestern University Law Center and subsequently earned his Masters of Law in Taxation from Georgetown University Law Center. Currently, operating his law office out of Mt. Laurel, N.J., Unger represents clients nationwide.
ABOUT THE AUTHOR: Todd S. Unger
Todd S. Unger is a seasoned tax attorney who proudly helps individuals nationwide with their IRS tax problems.
Copyright Todd S. Unger, Esq., LLC - Google+
More information about Todd S. Unger, Esq., LLC
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
How exactly does the new law impact same sex couples who live in states that do not recognize gay marriage?
The IRS has decided that it will recognize same-sex marriages nationwide regardless of where the couple resides. This is known as the “place of celebration approach.” According to the IRS, it will not recognize formal relationships under state law such as civil unions or domestic partnerships.
The place of celebration approach would work as follows: As long as a same-sex couple marries in a state that recognizes same-sex marriage, then the IRS will recognize that couple for federal tax purposes regardless of where the couple relocates.
The IRS will begin to follow the holding of Revenue Ruling 2013-17 on September 16, 2013. Therefore, for the 2012 tax year, and all prior years, same-sex spouses who file an original tax return on or after September 16, 2013 generally must file using a married filing separately or jointly filing status. If a same-sex spouse filed their tax return before September 16, 2013, they may choose, but are not required, to amend their returns to file using married filing separately or jointly filing status. Keep in mind that the benefits of filing a joint return may not always be greater than filing separately as unmarried individuals. Therefore, if you are a same-sex couple in a state that recognizes marriage, then you would want to crunch the numbers. If you’re better off filing jointly, then you may be due a tax refund.
Generally, a taxpayer may file a claim for refund three years from the due date of a return plus extensions or two years from the date the tax was paid, whichever is later. Some same-sex married couples may have filed protective claims, had a disability, or agreed to an extension all of which may extend the time to claim a tax refund.
The Supreme Court’s decision significantly impacted other areas such as retirement and health plans. The IRS clarified its position and provided guidance in Revenue Ruling 2013-17. If you have any questions about the IRS’s guidance for same-sex couples, please contact our office. The IRS is expected to issue more guidance for individuals as the 2014 filing season approaches and for employers and retirement plans. Our office will keep you posted on developments.
Attorney Todd Unger is known throughout the legal community as an expert in federal tax controversy matters. After working as a proprietary equity trader in New York, Unger pursued his law degree at Nova Southwestern University Law Center and subsequently earned his Masters of Law in Taxation from Georgetown University Law Center. Currently, operating his law office out of Mt. Laurel, N.J., Unger represents clients nationwide.
ABOUT THE AUTHOR: Todd S. Unger
Todd S. Unger is a seasoned tax attorney who proudly helps individuals nationwide with their IRS tax problems.
Copyright Todd S. Unger, Esq., LLC - Google+
More information about Todd S. Unger, Esq., LLC
View all articles published by Todd S. Unger, Esq., LLC
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
