Why Tax Season Is Even More Terrible for Same-Sex Couples
Married same-sex couples in Massachusetts often pay double when filing their federal returns during tax season.
The April 15 deadline for filing taxes is just days away, and while Massachusetts recognizes the marriage of same-sex couples, the federal government doesn’t, which creates a big hassle for those that are together each year.
“It is much harder for same-sex couples,” says Tina Salandra, CPA and principal of Numerical, LLC, based in New York. “[Tax season] usually means a more complex process, more time involved filling out the right forms, and usually more money.”
According to Salandra, the combination of the Defense of Marriage Act on the federal level and some states (like Massachusetts) recognizing same-sex marriage means a lot of extra hoops to jump through. She says that, even though same-sex couples must file their federal taxes as single, Massachusetts requires completion of a married federal return, which is used in computing state taxes but never filed with the federal government. “It requires a married spouse to file as single, or if they have children as head of household, but they can’t file that way on their state returns. So you really have to do a completely separate dummy federal return in order to arrive at the right numbers for your state return,” she says, adding that the process can be confusing for those that are married.
Boston resident Michael Archibald, who has been married to his husband, Jason, since 2008, says when he uses tax-paying software like TurboTax to help his spouse file returns, they have to pay double the fees due to the lack of federal recognition. “I suppose we can afford it, but a lot of people can’t afford it, and obviously it’s just not right [that we have to pay extra],” he says. “It charges you extra, and it’s ridiculous. It’s also a huge headache.”
Other areas during the filing process that can be especially troublesome for same-sex couples is making sure “gifts” given by a spouse are earmarked in federal returns—something heterosexual couples don’t need to worry about, according to Salandra. “When it comes to gift tax, they are at a big disadvantage, too” she says.
An ongoing battle to repeal DOMA made its way to the Supreme Court in March as supporters of same-sex marriage called for federal recognition for their status. Supreme Court justices are expected to make a decision on DOMA this summer, something Archibald says could make this the last year we he has to deal with the hassle. “There are so many different rights that we don’t get, such as the death benefits, too, but I am just hoping they are going to vote the right way on this. I think it’s a done deal—I hope,” he says.
Representatives from the American Civil Liberties Union of Massachusetts, who gathered on the steps of city hall in late March to ask the Court to strike down DOMA, say the differences in marriage recognition, for couples like Archibald and his husband, need to come to an end, so the financial burdens and impacts on gay couples can be lifted.
Chris Ott, communications director of the ACLUM, says one of the organizations clients, Edie Windsor, challenged DOMA after the federal government taxed her inheritance from her wife, Thea, in 2009, as though they were strangers, “forcing Edie to pay $360,000 more in taxes than she would have if she had been married to a man.”
“[If] that’s bad enough, even filing ordinary income taxes can be an expensive hassle for married same-sex couples,” says Ott. “Unfairness like this isn’t defending anyone’s marriage, and we hope that the Supreme Court will bring this kind of discrimination to an end.”