In Tax Disparity, States See Opportunity to Fight DOMA
“States’ rights,” that longstanding conservative rallying-cry, now finds itself in a more liberal context: The fight to overturn the Defense of Marriage Act.
On Sept. 8, three states that allow gay couples to marry challenged the 1996 law prohibiting the federal government from recognizing same-sex marriage. Many of the state challenges to DOMA touch on a particular headache for same-sex couples: Taxes.
As Reuters reported last month, the 1,000 federal statutes included in DOMA mean that married gay and lesbian couples often face hurdles to tax filing that include double compliance costs and dummy federal returns. The 130,000 legally married same-sex couples in the United States, provided they live in a state that recognizes their union, obtain state tax benefits for being married. They do not obtain these same benefits on their federal taxes—nor can they file joint federal tax returns, or take exemptions for a partner’s children, or obtain other convenient privileges the federal government awards to married heterosexual couples.
New York resident Edie Windsor found the federal government demanding $350,000 in estate taxes following the death of her wife. Had she been married to a man, Windsor’s wife could have transferred assets to her under a marital tax deduction with no tax penalty. But she isn’t, and according to the federal government, that means Windsor has no right to be considered married at all.
The case went to court, and Vermont, Connecticut, and New York have filed amicus briefs with the Second Circuit Court of Appeals stating that DOMA violates their rights by effectively “unmarrying” same-sex couples. In other words, DOMA is a challenge to that high-school Civics buzzword: Federalism.
Depending on the Appeals Court’s ruling, DOMA may soon be on a fast track to the Supreme Court. While Attorney General Eric Holder has affirmed that the Department of Justice will not defend DOMA in court, House Speaker John Boehner has taken up the law’s cause.
The Supreme Court will decide whether to take up California’s Proposition 8, which would be a similar landmark case for the marriage equality movement, this fall.
Shay O'Reilly is a reporter with Campus Progress. Follow him on Twitter @shaygabriel.