Since the Supreme Court’s ruling allowing marriage between same sex partners in any state this past June, we have had a number of tax filing related inquiries and concerns regarding same-sex marriage deductions. At minimum, the IRS will recognize all same-sex marriages for federal tax filing purposes.
Same-sex spouses must generally file using a married filing jointly or separately filing statuses. For federal tax purposes, the IRS has a general rule that recognizes a marriage of same-sex couples that was entered into validly in either a domestic or foreign jurisdiction whose laws authorize the marriage of two individuals of the same sex.
Related read: Tax Benefits of Same-sex Marriage
This prompts a few questions on what this ability to file jointly for married same-sex couples:
Q: Can a same-sex spouse be a dependent of the taxpayer?
A: No. A taxpayer’s spouse (regardless of gender) cannot be a dependent of the taxpayer.
Q: Can a same-sex married taxpayer file using the head of household status
A: No. The married taxpayer must file using either the married filing jointly or married filing separately status.
Q: If same-sex spouses file as married filing separate, which parent may claim the child as a dependent
A: Either parent may claim the child as a dependent, but not both.
Q: Can a same-sex married taxpayer claim the standard deduction if the taxpayer’s spouse chooses to itemize their deductions
A: No. If one spouse itemizes their deductions, the other may not claim the standard deduction.
Q: If a taxpayer adopts the child of their same-sex spouse as a second parent or co-parent, may the taxpayer claim the adoption credit for the qualifying adoption expenses he or she pays to adopt the child
A: No. The adopting credit may not claim the credit since it was a child of their spouse.
In addition to the above questions, there are special rules to keep in mind for qualified retirement plans as well:
- Qualified retirement plans must treat a same-sex spouse as a spouse in the same manner as the federal tax laws does.
- A person in a registered domestic partnership or civil union is NOT considered to be a spouse for federal tax law requirements relating to qualified retirement plans. Note this is true for both same and opposite sex partners.
- If a qualified defined contribution plan states that a participant’s account must be paid to the participant’s spouse upon death of the participant, the death benefit will be paid to the same-sex surviving spouse unless the participant named another beneficiary. (This type of plan is not required; however, to pay out the balance to a surviving domestic partner, unless he or she was named as the designated beneficiary).
The Zinner team of financial and business advisors can help you and your spouse file correctly. I'm ready to help; contact me at 216-831-0733 or cblankschaen@zinnerco.com for a no cost, no obligation consultation.