A Taxing Time for Gay Couples

Sun. April 15, 2012 12:00 AM
by Waymon Hudson

We all know the old saying-- "Nothing is certain in life but death and taxes." Yet for same-sex couples, tax time is anything but certain.

You may think that the new Illinois civil union law solves all the joint tax filing confusion for gay couples. The law says "persons entering into a civil union with the obligations, responsibilities, protections, and benefits afforded or recognized by the law of Illinois to spouses." In short, anyone in a civil union gets the same state benefits as someone who is married. It should be simple, right? Wrong.

Proving the problem with separate and unequal relationship recognition like civil unions, the Illinois Department of Revenue posted a rather surprising reading of the civil union act on its webpage back in June, saying that couples in civil unions "may not file joint Illinois returns" and the new law "did not change the Illinois income tax laws" due to the federal Defense of Marriage Act (DOMA). Joint tax-filing for couples in civil unions was one of the main benefits quoted during the debate of the new law in Illinois, yet even the broad language and clear intent of the Civil Unions Act couldn't erase the confusion in the Department of Revenue over how to treat the different status of same-sex couples.

After much attention from the media and activists alike, the Illinois Department of Revenue confirmed that at the request of Governor Pat Quinn, the state has issued new guidelines allowing couples in civil unions to file jointly, electing to file state taxes as "married, filed jointly" or "married, filed separately" just as married spouses do. But that's just state taxes-- gay couples will still have to file federal tax returns individually.

Confused yet? You're not alone.

Differences in state and federal law force gay couples in civil unions or state-recognized marriages to take additional steps to file jointly. Same-sex couples must fill out a "dummy" joint federal tax form in order to generate the figures that are necessary to file a state tax return as a couple. That means completing four tax returns: one dummy federal return, one state return and two individual federal returns. This not only means more confusion, but more money for tax preparation services because of the paperwork, time and level of detail it takes.

DOMA adds confusing hurdles for couples that every tax year not only make gay couples pay thousands more in federal tax dollars, but also serve as a humiliating yearly reminder of our inequity in the most basic of ways. An average retired same-sex couple will be denied more than $8,000 a year in Social Security survivor benefits upon the death of the higher-earning spouse after retirement. Even our domestic partner health insurance from a spouse's workplace are taxed for same-sex couples unlike the untaxed spousal benefits for heterosexual couples. In fact, LGBT families pay an average of $1,100 more in taxes a year for health care coverage.

But beyond just the financial impact, every year I am forced to be "single" by the federal government or face tax penalties and auditing. It is a glaring and humiliating example of why separate is never equal.

We decided long ago that segmenting minorities out for separate treatment can never create equality. Creating new, separate, and different levels of rights and recognition among committed couples only creates further inequity, confusion, and discord, even on things as mundane as taxes.

So yes-- the taxman cometh. And with him, another yearly reminder that my marriage is seen as less than others by our federal government.