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IRS Goes
After Gay Couples
by Paul
Johnson, Washington Bureau Chief
365Gay.com from the Web, March 2, 2006
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Washington, -- The Internal
Revenue Service has begun warning tax preparers, businesses and state
governments that same-sex couples legally married in Massachusetts or registered
as domestic partners in states such as California and New Jersey must file
separate income tax forms.
Tax returns this year must be filed by April 17.
Citing the so-called Federal Defense of Marriage Act the IRS says that the US
government does not recognize anything other than legally married opposite-sex
couples.
The law allows straight couples who are married to divide their incomes when
they file jointly, usually meaning a lower tax rate.
"Not only does the federal government label gay relationships as unworthy but it
then turns around and steals our money," Lambda Legal senior attorney David
Buckle told 365Gay.com.
Attempts to file a joint returns could lead to fines or other penalties.
It is not the first time the IRS has issued a warning. A similar one came
out after same-sex couple began marrying in Massachusetts.
Last year a federal judge dismissed a lawsuit filed by a gay couple in Minnesota
claiming they deserved a tax refund because they were legally married and should
be granted married taxpayer status.
People who receive health insurance from their state or local government or
through their employer for their spouses or domestic partners are additionally
hit with taxes.
Spousal health benefits are not taxed. But, since the IRS does not
recognize gay relationships the benefits are considered income. In some
cases the tax outweighs any savings.
Rhode Island extended health and insurance benefits to the domestic partners of
state workers in 2001 but last month realized it had not withheld federal taxes
on those benefits. Some workers owe up to five years in back taxes that
the state forgot to collect through payroll deductions.
A study in 2004 shows that gay families pay on average higher taxes and get
fewer benefits.
The joint study by the Human Rights Campaign and the Urban Institute also found
that when a gay or lesbian parent dies leaving a young child behind, the loss of
Social Security survivor benefits to the family can range from $100,000 to
$250,000, depending on whether state laws permitted both parents to establish a
legal relationship to the surviving child.
On Tuesday the National Sexuality Resource Center released a new study showing
widespread psychological and social harm inflicted on same-sex couples because
they are denied the right to marry.
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