Tax Code to Become LGBT-Friendly


The Obama administration on Wednesday proposed regulations that would make references in the Internal Revenue Code to “husband” and “wife” include same-sex marriages.

The Internal Revenue Code (IRC), is the domestic part of the Federal tax law in the United States, and covers income tax, estate taxes, payroll taxes, gift taxes, and excise taxes; as well as procedure and administration. The clarifications in the code’s wording are meant to safeguard against anyone interpreting it too literally and making any claims of discrimination.

This decision has been made in the wake of the Supreme Court’s ruling in June to extend marriage rights to same-sex couples all across America, and it will apply to all tax provisions in which marriage matters, including filing status, exemptions, the standard deduction, employee benefits, IRA contributions, the earned income tax credit and the child tax credit.

Jack Lew, the Treasury Secretary, said in a statement, “The proposed regulations confirm that terms in the federal tax code relating to marriage should be interpreted to include same-sex spouses as well as opposite-sex spouses, ensuring that all are treated equally under the law.”

This ruling is similar to the one made back in 2013 after the high court struck down a major part of the Defense of Marriage Act (DOMA), stating that in all states that recognized same-sex marriage, the language used in the tax code would represent them too. From the IRS website:

“[…] 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.

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.”

So while the tax code has only had a clarification of language and not an actual change, it’s a step in the right direction for same-sex inclusion to become the norm in all facets of government. David Stacy, who is the government affairs director for the Human Rights Campaign, which is the largest gay right organization in the United States, said changing the code is the eventual goal, but in the meantime the proposal “will make it very clear to the millions of people who use the tax code, and to tax preparers, exactly what this means.”

If you would like legal counsel pertaining your family law matter, please get in touch with Daniella Lyttle at Lyttle Law Firm either via the website or by calling 512-215-5225.

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