Roosevelt Campus Network 10 Ideas Competition: Equal Justice

Same-Sex Marriage Injustice: Straight Couples Pay $1,069 Less in Taxes

Erik Lampmann
in
Politics
1 year ago

Same-Sex Marriage Injustice: Straight Couples Pay $1,069 Less in Taxes

Employers should change their LGBTQ priorities to include the absorption of an added tax on the transfer of health benefits among domestic partners while advocating for the repeal of the exclusionary Defense of Marriage Act (DOMA).

The 1996 DOMA defined marriage as “only a legal union between one man and one woman as husband and wife, [where] the word ‘spouse’ refers only to a person of the opposite sex who is a husband or wife.” This legislation affects the daily lives of the estimated 901,997 U.S. same-sex couples. However, LGBTQ activists did not originally recognize another effect of DOMA – the law’s impact on Internal Revenue Service (IRS) policy whereby health care benefits transferred by employees to registered domestic partners – within those organizations that recognize domestic partnerships – are taxed as income. This policy results in same-sex couples paying on average at least $1,069 more than identical heterosexual, married couples in taxes.

In attempting to ameliorate inequitable tax practices affecting same-sex couples, progressive organizations are “grossing-up” the wages of employees in same-sex partnerships. This practice involves increasing employees’ pre-tax salaries in order to account for the tax on shared health benefits and the added income tax of such an adjustment. In this way, they equalize the tax burdens paid by employees regardless of sexual orientation, gender identity, and gender expression. Tech start-ups and investment houses, in particular, including Google, Facebook, Apple, Barclay’s, and Goldman Sachs all “gross-up” domestic partners’ wages. Recently, Bowdoin College also instituted a similar policy.

Action by these employers motivated the Tax Parity for Health Plan Beneficiaries Act of 2011, introduced by Senator Charles Schumer along with eighteen cosponsors on June 9, 2011 and since referred to the Committee on Finance.

Analysis

Existing policy on domestic partner benefits places an unfair tax burden on same-sex couples. While DOMA remains a significant roadblock on the way toward a culture of inclusion with respect to LGBTQ Americans, by removing the tax burden currently enforced by the IRS in conjunction with federal law, we can make using health care, filing tax returns, and pursuing employment that much easier for same-sex couples. The current tax structure fails to account for the increasing number of organizations that recognize domestic partnerships, number of same-sex couples, as well as state-level successes with marriage equality. Institutionalizing a more equitable tax structure for recipients of domestic partnership benefits would clear up confusion among couples, legislators, and lawyers in states that do recognize civil unions, marriage equality, or same-sex relationships that originated in other states. Amending the existing tax structure imposed on domestic partnership beneficiaries will positively affect almost a million same-sex couples in the United States by removing everyday difficulties of taxes, health insurance, and employment options.

Next Steps

It is essential that progressives across the United States highlight this issue in national discourse by amplifying the experiences with tax inequities among same-sex couples through storytelling. Using Senator Schumer’s bill as a template, organizations that recognize domestic partnerships can implement “grossing-up” practices and join a coalition of 80 businesses committed to “tax equity” to place political pressure on officials to legislate.8 Once this issue attracts more supporters -- particularly among employee LGBTQ affinity groups -- a critical mass will be able to force change in Congress that will eventually lead to the repeal of DOMA.

Sign up to join the discussion

The Debaters

Super PAC Tax Loophole Allows Non-Profits to Run Wild With Campaign Spending
By Ali Anderson

Ali is a recent graduate of Mount Holyoke College with a degree in Politics and a concentration in Law and Public Policy. She now works as a legislative aide at in the Delaware House o…

U.S. Prison Reform Should Prioritize Pregnant Women
By Stephan Grabner

A connoisseur of fine chocolate and lover of mountains. …

Ohio Businesses Must Stop Discriminating Against Gay Employees
By Cecile Murray

I'm a first year college student originally from Ohio and now studying at the University of Chicago, currently considering a major in economics. I'm politically independent an…

Same-Sex Marriage Injustice: Straight Couples Pay $1,069 Less in Taxes
By Erik Lampmann

A student leader, policy innovator, and queer advocate, Erik works to devolop a world of inclusion, respect, and sustainable social change. …

Yet Another Reason We Need Immigration Reform: 1,400 Peaceful Asylum Seekers Detained Every Day
By Kelsey Jost-Creegan

UNC-Chapel Hill Undergraduate studying Global Studies and Spanish …

Voter Turnout is Dismal in the U.S., Here's How to Fix It
By Michael Francus

I am a student at the University of Chicago and President of our Roosevelt Chapter.…

Sexual Assault of Native American Women on the Rise
By Katie Reilly

Student at the University of North Carolina at Chapel Hill, involved in the UNC chapter of the Roosevelt Institute. I'm interested in journalism, political science and social justi…

To End Homelessness in North Carolina, Give Tax Credits to Businesses
By Arjun Bhattacharya

I'm an undergraduate at UNC-Chapel Hill, majoring in biology and statistics.…

NYC Food Deserts Can Be Solved With Community Gardens
By Emily Apple

Emily is a student at CUNY-Hunter College majoring in political science and minoring in public policy and human rights. She is the Northeast Policy Coordinator for the Roosevelt Institu…

68 Billion Pounds of Food Go to Waste Every Year, Here's How to Fix It
By Ben Simon

Ben Simon is a senior Government and Politics major at the University of Maryland, College Park. Ben got a quick start in the world of change making five years ago as a student at Montg…