Same-Sex Marriage Archives - Page 2 of 6

View From McDermott: Dollars and Cents, the Cost of Benefit Coverage

by Brian Tiemann and Todd Solomon | Oct 10, 2013 | Employment, Health and Welfare Plans

Many employers have begun the process of evaluating their options and obligations with respect to extending benefit coverage under employer-sponsored benefit plans to same-sex spouses in light of the U.S. Supreme Court’s recent ruling on Section 3 of the Defense of Marriage Act. Section 3 of DOMA provided that for all purposes of federal law the word “marriage” meant “only a legal union between one man and one woman as husband and wife,” and the word “spouse” referred “only to a person of the opposite-sex who is a husband or wife.” In June 2013, the Supreme Court ruled in United States v. Windsor that Section 3 of DOMA was an unconstitutional “deprivation of the liberty of the person protected by the Fifth Amendment.” The effect of this ruling is that federal law now generally will defer to state law definitions of marriage, including same-sex marriage, which has been legalized in 13 states and the District of Columbia.

As part of evaluating options for extending benefit coverage to same-sex spouses, employers need to consider the financial implications of such benefits. These implications include costs the employer will incur in extending such benefits, as well as the financial impact on employees who opt to utilize such benefits. Many of these costs are dependent upon the spousal benefits the employer currently offers, although the relevant considerations and cost estimates outlined below may be helpful resources.

To read the full article, click here.

IRS and DOL Guidance Clarifies Employee Benefits Impact of Supreme Court’s DOMA Ruling

by Brian Tiemann and Todd Solomon | Oct 2, 2013 | Health and Welfare Plans, Retirement Plans

Recent guidance issued by the U.S. Department of the Treasury, the Internal Revenue Service (IRS) and the Employee Benefits Security Administration (EBSA) division of the U.S. Department of Labor (DOL) provides some initial clarifications on how U.S. v. Windsor will affect benefits for same-sex spouses. The guidance provides that same-sex couples legally married in a jurisdiction with laws authorizing same-sex marriage will be treated as married for federal tax purposes, regardless of whether the couple resides in a state where same-sex marriage is recognized.

To read the full article, click here.

Treasury Department & IRS Issue DOMA Guidance – Adopt a “State of Celebration” Approach

by Brian Tiemann and Todd Solomon | Aug 29, 2013 | Health and Welfare Plans, Retirement Plans

In Internal Revenue Service (IRS) Revenue Ruling 2013-17, the U.S. Department of the Treasury and the IRS today ruled that legally married same-sex couples will be treated as married for federal tax purposes. Importantly, the ruling applies regardless of whether the couple lives in a jurisdiction that does not recognize same-sex marriage. In other words, the Treasury Department and IRS have adopted a “state of celebration” rule rather than a “state of residence” rule. Click here for IRS answers to some frequently asked questions.

As a result, it will be possible for same-sex couples to be what we call “federally-recognized same-sex spouses” even if they are not treated as married in the state in which they currently reside. That situation in fact, could become extremely common if same-sex couples travel to a jurisdiction solely to get married and obtain federal tax recognition of their marriage. (See the Obergefell case, discussed in “Two Federal Courts Recognize Same-Sex Spousal Rights for Residents of States Not Permitting Same-Sex Marriage” as one recent example.)

This situation will require employers in all states – not just the 13 states (and the District of Columbia) that currently permit same-sex marriage – to prepare for same-sex couples to request spousal benefits under the employer’s various benefit programs, particularly those programs where preferential spousal treatment is required by federal law (e.g., spousal protection under qualified retirement plans, special enrollment and COBRA rights under health and welfare plans, etc.) The IRS intends to issue further guidance on the retroactive implications of this position.

Additionally, this new guidance will allow same-sex spouses to claim refunds for open tax years for income and employment taxes they paid on imputed income on the value of health coverage. Similarly, there is a procedure for employers to obtain employment tax refunds based on coverage provided to employees’ same-sex spouses.

Finally, note that the IRS guidance does not apply to registered domestic partners, civil unions or other similar relationships recognized under state law but that are not denominated as marriage under that state’s law.

Further McDermott guidance on this important development will be forthcoming shortly. In the meantime, please contact the authors or your regular McDermott attorney if you have questions.

Two Federal Courts Recognize Same-Sex Spousal Rights for Residents of States Not Permitting Same-Sex Marriage

by McDermott Will & Emery | Aug 2, 2013 | Employment, Health and Welfare Plans

by Joseph S. Adams, Todd A. Solomon and Jacob Mattinson

Obergefell v. Kasich and Cozen O’Connor v. Tobits may reflect a growing trend of courts and other bodies to recognize same-sex marriages validly celebrated elsewhere even if the couple’s current state of residence does not recognize such marriages. Pending further guidance, employers should begin discussing plan amendments and administrative procedures that may be necessary to clarify benefit eligibility for same-sex spouses and partners.

To read the full article, click here.

Supreme Court Rules on DOMA and California’s Proposition 8

by Jackie Sinn | Jun 26, 2013 | Benefit Controversies

by Joseph Adams, Todd Solomon and Brian Tiemann

Earlier this morning, in the case of U.S. v. Windsor, the Supreme Court of the United States found Section 3 of the Defense of Marriage Act (DOMA) to be unconstitutional. In a 5-4 decision authored by Justice Kennedy, the Court ruled that Section 3 of DOMA deprived same-sex couples of the equal protection guarantee of the Fifth Amendment of the U.S. Constitution. Note that the Windsor decision only applies to Section 3 of DOMA (which previously prohibited same-sex couples from enjoying any benefit under federal law). The decision does not apply to another key provision of DOMA that allows one state to refuse to recognize same-sex marriages performed in another state.

In the separate Hollingsworth v. Perry case challenging California’s Proposition 8 (which prohibited same-sex marriages), the Court ruled that it lacked jurisdiction to rule on the constitutionality of Proposition 8. This ruling has the effect of reinstating the original opinion of the United States District Court for the Northern District of California which found Proposition 8 unconstitutional under California law and prohibited the enforcement of Proposition 8 statewide. As a result, same-sex marriages will resume in California relatively shortly (perhaps in as soon as a month). As widely expected, the Court did not declare a constitutional right to marry in all states.

For more information on these cases and the immediate impact on employee benefit programs, register for our webinar (see link in Featured Post above) or visit “DOMA and Proposition 8: Immediate implications for employee benefit plan sponsors” scheduled for July 2, 2013.

Supreme Court Ruling on DOMA Could Lead to Refunds of Federal Taxes

by McDermott Will & Emery | Jun 20, 2013 | Employment

by Todd A. Solomon, Ruth Wimer and Brian J. Tiemann

Employers providing benefits for employees’ same-sex spouses may want to consider the availability of federal payroll tax refunds if the Supreme Court of the United States finds Section 3 of the Defense of Marriage Act (DOMA) unconstitutional. Employers currently must impute income to an employee for the fair market value of benefit coverage for a non-dependent same-sex spouse. Such imputed income is subject to federal income and payroll taxes, as well as state income taxes in the majority of states.

To read the full article, click here.

Webcast – DOMA and Proposition 8: Immediate Implications for Employee Benefit Plan Sponsors

by McDermott Will & Emery | Jun 19, 2013 | Employee Benefits, Employment

July 2, 2013
11:00 am – 12:00 pm EDT

To register, click here.

As a result of the federal Defense of Marriage Act (DOMA), same-sex relationships have not been recognized for any purpose under any federal law, including the Employee Retirement Income Security Act, the Internal Revenue Code and COBRA. Historically, this has created significant implications for the administration of benefit plans covering same-sex partners, including the taxation of health, dental and vision benefits and survivor benefits under retirement plans. Employers that have extended equal benefits to lesbian, gay, bisexual and transgender employees have faced significant administrative and other challenges. Employers that have not extended benefits to same-sex partners have struggled to understand their legal obligations.

Earlier this year, the Supreme Court of the United States heard arguments on the constitutionality of DOMA and on California’s “Proposition 8,” which denies same-sex couples the right to marry in that state. The Supreme Court is expected to issue its rulings in these cases in June. Based on this, McDermott Will & Emery invites you to a webcast to discuss the impact of these landmark decisions on employee benefit plan sponsors and to address key considerations for employer-provided plans, including:

An up-to-date description of the federal taxation of health and welfare benefits
A summary of steps employers must take in light of the Supreme Court’s decisions
What benefits must employers offer to same-sex partners

McDermott Speakers
Joseph S. Adams, Partner
Todd A. Solomon, Partner
Brian J. Tiemann, Associate

For more information, please contact Carolyn Verscaj.

France Allows Same-Sex Marriages

by McDermott Will & Emery | Jun 11, 2013 | Employment

by Lionel Lesur and Lisa A. Linsky

On April 23, 2013, the French Parliament gave final approval to a bill allowing same-sex couples to get married and adopt children. This makes France the 14th country in the world to legalize marriage between same-sex couples, and the 9th in Europe. Law No.2013-404, approving marriages between same-sex couples, was signed into law by the French President on May 17, 2013 and published in the Official Journal on May 18, 2013. To read the full article, click here.

Illinois Senate Passes Bill to Legalize Same-Sex Marriage

by McDermott Will & Emery | Feb 15, 2013 | Benefit Controversies

by Todd A. Solomon and Brian J. Tiemann

The Illinois Senate voted Thursday, February 14, 2013, in favor of a bill to legalize same-sex marriage. The bill now goes before the Illinois House of Representatives (the House), where greater opposition is expected. Governor Pat Quinn has indicated he will sign the bill if it is passed by the House. If enacted, same-sex marriage would become legal in Illinois 30 days after it is enacted. Illinois would be the 10th state to legalize same-sex marriage. Same-sex marriage is already legal in Connecticut, Iowa, Maine, Maryland, Massachusetts, New Hampshire, New York, Vermont, Washington and the District of Columbia. In addition, California recognizes same-sex marriages performed between June 17-November 4, 2008. If same-sex marriage is legalized in Illinois, employers will need to consider whether their benefit plans and procedures need to be updated to address benefit eligibility of same-sex spouses.

Results of State Voter Referendums on Same-Sex Marriage: Implications for Employee Benefit Plans

by McDermott Will & Emery | Nov 13, 2012 | Benefit Controversies, Health and Welfare Plans

by Joseph S. Adams, Todd A. Solomon, Jacob Mattinson and Brian J. Tiemann

Voters in Maine, Maryland and Washington approved the legalization of same-sex marriage in their states. In addition, voters in Minnesota rejected a state constitutional amendment to define marriage as an opposite-sex union. The outcome of these referendums adds complexity to the options and obligations of employers in providing benefits for employees’ same-sex spouses and partners.

To read the full article, click here.

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