Tax Tips for Gays, Lesbians and Same-Sex Couples

From Ramone Johnson,

Don’t get bogged down in federal and state tax confusion. Here’s what gays, lesbians and same-sex couples need to know about filing federal and state taxes:

Can gay and lesbian couples file joint federal taxes?

The Defense of Marriage Act (DOMA), signed into law in 1996, defines marriage as between one man and one woman, prohibiting federal recognition of same-sex couples. And since only married couples can file joint federal tax returns, all gay and lesbian couples (including same-sex spouses in Massachusetts) must file federal taxes as individuals.

I live in Massachusetts. Can my husband (or wife) and I file joint state taxes?

Massachusetts is the only U.S. state that recognizes same-sex marriage, therefore legally married gay and lesbian couples can file joint Massachusetts state taxes.

Massachusetts gay and lesbian couples must still file as individuals on their federal returns for reasons mentioned above.

Gay Tax payers

My state offers civil unions or domestic partnerships. Can we file jointly?

With the exception of New Jersey, most civil union and domestic partnership laws provide some benefits of marriage, but fall short at tax benefits for same-sex couples. Civil union and domestic partnership laws also vary state-by-state. Below is a summary of tax filing rules for same-sex couples in each state that offers either civil unions or domestic partnerships:

  • California According to the State of California Tax Franchise Board, same-sex couples filing for years prior to 2007 must file individually. For the 2007 tax year, gay and lesbian couples can file joint state taxes.
  • New Jersey If you are married or in a civil union on the last day of the tax year, according to the New Jersey Division of Taxation, you and your spouse/civil union partner may choose to file as married/civil union couple, filing a joint return, or married/civil union partner, filing a separate return. You may use the “joint” or “separate” statuses only if you were married or in a civil union on the last day of the tax year. If you were a member of a domestic partnership registered in New Jersey, you are not considered “married” and you may not use these filing statuses.
  • Connecticut As of the 2006 tax year, civil union couples can file joint state tax returns in Connecticut.
  • New Hampshire Given the recent enactment of New Hampshire Civil Unions (they went into affect January 1, 2008), registered same-sex couples must file separately for the 2007 tax season. Robin Pazeglio, a supervisor at the New Hampshire Department of Revenue Administration, advises that same-sex couples will be able to file jointly for the 2008 tax season, the returns of which will be filed beginning January 2009.
  • Oregon Oregon provisions allows some taxpayers who qualify as domestic partners to claim a subtraction from Oregon income. However, under Oregon law, imputed income may be taxable to you. Read more about Oregon’s complex domestic partner tax structure at the Oregon Department of Revenue.
  • Vermont Registered civil union partners in Vermont can legally file joint state taxes.
  • Washington D.C. Under the Domestic Partnerships Joint Filing Act of 2006, registered domestic partners in Washington D.C. can file joint returns.
  • Washington State The State of Washington does not allow domestic partners to file joint returns.

Be sure to consult a tax professional before preparing and filing your returns to avoid any filing errors.

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