Same-sex couples can be married in Washington state beginning Sunday, but they still won't get equal treatment under federal tax law.
Seattle Certified Public Accountant Jordan Heitzman specializes in tax returns for same-sex couples. He says the federal Defense of Marriage Act keeps the Internal Revenue Service from treating gay couples exactly like straight couples.
For example, he says if one person adds their new same-sex spouse to the deed of their house, the IRS treats that as a taxable gift. Not so for straight couples, "If you are a straight married couple there is an exclusion in the federal IRS code that says you don't have to pay taxes for gifts to your spouse."
Heitzman says that makes something as simple as combining bank accounts tricky. "(If) I had $100,000 sitting in a bank account and I add you to the account as a signer. I just gifted you $50,000."
Because Washington is a community property state, IRS rules require Heitzman to add up a couple's shared income, divide it equally among the spouses, then file their taxes separately as if they are two single people.
Same-sex couples could lose out when it comes to deductions for children, health insurance premiums and Social Security Survivor's Benefits.
Helen Folsom is client of Heitzman, who plans to be married in January and is asking for advice on how to handle their real estate. She says the tax code will not deter them. "Everyday my mind is blown by what life is like now to be in my 60s and she in her 70s and be in love."
Heitzman encourages all same-sex couples to seek tax advice before making any significant financial changes in their lives.
The U.S. Supreme Court may decide as early as Friday whether to hear challenges that could overturn the Defense of Marriage Act.