Small Business Taxes & Management

Special Report

IRS Provides Guidance on Same-Sex Marriages


Small Business Taxes & ManagementTM--Copyright 2013, A/N Group, Inc.


The U.S. Department of the Treasury and the Internal Revenue Service (IRS) have ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes. The ruling applies regardless of whether the couple lives in a jurisdiction that recognizes same-sex marriage or a jurisdiction that does not recognize same-sex marriage.

Example--You and your spouse were married in a civil ceremony in New York, a state that recognizes same-sex marriages. If you live in New York, you can file as married. If you move to a state that does not recognize same-sex marriages, such as Texas, you would still file as married for your federal return.

The ruling implements federal tax aspects of the June 26th Supreme Court decision invalidating a key provision of the 1996 Defense of Marriage Act.

Under the ruling, same-sex couples will be treated as married for all federal tax purposes, including income and gift and estate taxes. The ruling applies to all federal tax provisions where marriage is a factor, including filing status, claiming personal and dependency exemptions, taking the standard deduction, employee benefits, contributing to an IRA and claiming the earned income tax credit or child tax credit.

Tax Note--The ruling applies to all aspects of the tax code, not just filing status. For example, Section 66, treatment of community income, and Sec. 469(1)(5) the $25,000 exception for real property passive losses apply just as they do to other married couples.

Tax Note--That means if you're married you will have to file as either married or married filing separate. You will no longer be able to file as single. While that may not be as attractive, you don't have a choice. If you're not married, you might want to work through the numbers before getting married.

Any same-sex marriage legally entered into in one of the 50 states, the District of Columbia, a U.S. territory or a foreign country will be covered by the ruling. However, the ruling does not apply to registered domestic partnerships, civil unions or similar formal relationships recognized under state law.

Tax Note--Civil unions, domestic partnerships don't count as marriage. You might consider getting married in a state that recognizes same-sex marriage. If you do so before the end of the year you'll be considered married for the full year.

Legally-married same-sex couples generally must file their 2013 federal income tax return using either the married filing jointly or married filing separately filing status.

Individuals who were in same-sex marriages may, but are not required to, file original or amended returns choosing to be treated as married for federal tax purposes for one or more prior tax years still open under the statute of limitations.

Generally, the statute of limitations for filing a refund claim is three years from the date the return was filed or two years from the date the tax was paid, whichever is later. As a result, refund claims can still be filed for tax years 2010, 2011 and 2012. Some taxpayers may have special circumstances, such as signing an agreement with the IRS to keep the statute of limitations open, that permit them to file refund claims for tax years 2009 and earlier.

Tax Note--The 2009 year is still open for taxpayers who had an extension and didn't file until September or October, 2010. But time is rapidly running out. If you have computer software from that year, preparing a joint return, at least to see if filing an amended return makes sense, should be fairly easy. If you don't have the software, most tax professionals should still have a copy.

Additionally, employees who purchased same-sex spouse health insurance coverage from their employers on an after-tax basis may treat the amounts paid for that coverage as pre-tax and excludable from income.


How to File a Claim for Refund

Taxpayers who wish to file a refund claim for income taxes should use Form 1040X, Amended U.S. Individual Income Tax Return.

Taxpayers who wish to file a refund claim for gift or estate taxes should file Form 843, Claim for Refund and Request for Abatement. For information on filing an amended return, see Tax Topic 308, Amended Returns, available on, or the Instructions to Forms 1040X and 843. Information on where to file your amended returns is available in the instructions to the form.

Tax Note--Employers and employees may want to file a claim for social security and Medicare taxes paid on health care benefits under a cafeteria plan or paid by an employer for the spouse in a same-sex marriage. Employees may want to refund claim for income taxes paid on these plans.


Future Guidance

Treasury and the IRS intend to issue streamlined procedures for employers who wish to file refund claims for payroll taxes paid on previously-taxed health insurance and fringe benefits provided to same-sex spouses. Treasury and IRS also intend to issue further guidance on cafeteria plans and on how qualified retirement plans and other tax-favored arrangements should treat same-sex spouses for periods before the effective date of this Revenue Ruling.

Tax Note--Streamlined procedures may make it easier to file a refund claim and may make getting that refund faster. If you're not in a rush because of an expiring deadline, you might want to wait for additional guidance.

Other agencies may provide guidance on other federal programs that they administer that are affected by the Code.

Revenue Ruling 2013-17, along with updated Frequently Asked Questions for same-sex couples and updated FAQs for registered domestic partners and individuals in civil unions, are available on See also Publication 555, Community Property.

Treasury and the IRS will begin applying the terms of Revenue Ruling 2013-17 on Sept. 16, 2013, but taxpayers who wish to rely on the terms of the Revenue Ruling for earlier periods may choose to do so, as long as the statute of limitations for the earlier period has not expired.


Copyright 2013 by A/N Group, Inc. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Articles in this publication are not intended to be used, and cannot be used, for the purpose of avoiding accuracy-related penalties that may be imposed on a taxpayer. The information is not necessarily a complete summary of all materials on the subject. Copyright is not claimed on material from U.S. Government sources.--ISSN 1089-1536

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--Last Update 08/29/13