TaxConnections Picture - Gay GroomsDOMA defined marriage as a union between a man and a woman. The case involved a same-sex couple who were married in Canada. One spouse died but the other spouse was not allowed to use the unlimited marital deduction resulting in $340,000 additional estate taxes [J.K. Lasser’s Monthly Tax Letter, August 2013]. The Act was declared unconstitutional by the United States Supreme Court [Windsor, No. 12-307, 6/26/13]. Under the Act, same-sex couples, who were married and resided in states sanctioning same-sex marriage, did not have the same rights under federal tax law as did different-sex married couples. That meant they were not allowed to file a joint income tax return or use the unlimited marital deduction for estate and gift taxes. This deduction enables the unused estate tax exemption of the first deceased spouse to be used by the surviving spouse. After the Supreme Court decision, same-sex married couples, residing in states that sanction gay marriage, will now be afforded the same rights as different-sex married couples for federal income, estate, and gift tax purposes [J.K. Lasser’s Monthly Tax Letter, August 2013]. Same-sex married couples must now file a joint return or separate returns. If they file a joint return, they may be subject to the “marriage penalty” if both spouses work and earn income over a certain threshold. If only one person in the couple works, they will have a reduction in their taxes. They can no longer file as single or head of household, but head of household and innocent spouse status may be applicable in the same circumstances as it is for different-sex married couples (see previous article on filing status by this author). Read More