People in same-sex relationships in California have had a tumultuous ride over the last year. Between Proposition 8 and the uncertainty over the Federal Defense of Marriage Act, it might be difficult for same-sex couples and people in domestic partnerships to even know where they stand under the current law.
But at least one California legislator is attempting to provide same-sex couples and their families some relief in the form of a tax break that other opposite sex spouses currently enjoy. Under federal law same-sex partners have to pay taxes on their partner’s health benefits, but some California companies, realizing the unfairness of this practice, reimburse this tax for their employees. This reimbursement is still taxed by the state to the tune of roughly $540 a year on average, but this bill would eliminate the state reimbursement tax and provide some help for an estimated 20,000 people in the state.
Same sex couples are surely appreciative of these efforts, but where they could really use some relief is in the realm of estate law. Because of the multitude of changes in state law and the court cases surrounding the federal Defense of Marriage Act, people in domestic partnerships have a tough time knowing how to navigate the law to avoid paying unnecessary taxation, but also avoiding probate if something happens to them or their partner.
In life and death, people in traditional marriages and same-sex relationships alike simply want to take care of their loved ones. It should not be any more difficult for one than the other, but unfortunately under current law, it certainly can be more confusing for domestic partners. An experienced estates and trusts attorney can help same-sex partners get the most current and accurate legal advice when it comes to providing for loved ones while avoiding taxes.
Source: CBS San Francisco “Lawmaker Proposes Tax Relief Legislation For California Same-Sex Couples,” Feb. 15, 2013