DOMA and the IRS- Big Changes on the Horizon
With the Supreme Court’s decision on the Defense of Marriange Act (DOMA), the IRS has it’s work cut out for them. With some states acknowledging same-sex marriage and other’s not, a decision has to be made whether the IRS will recognize same-sex marriages even if that couple’s home state does not. For same-sex couples in states that recognize same-sex marriage, they will file in the same ways heterosexual married couples can.
Not all is beneficial for same-sex couples filing as married next year- some will pay higher marginal tax rates (marriage penalty) and others may not be able to claim as many tax credits as when filing single (adoption credits, for example).
Some other big questions are what to do retroactively for benefits and also taxes for same-sex couples and even their employers, as well as estate taxes. Will same-sex couples have to re-do past taxes?
There are definitely a lot of changes on the horizon for same-sex couples. It will be interesting to see what the IRS reveals regarding taxes over the next few weeks between the decision on DOMA and also the health-care decisions.
Learn more about the issues at Huffington Post and Business Week.