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Same Sex Couple Taxation

Updated on April 11, 2015

The United States has welcomed constant change for many years due to our rapidly growing environment. Freedom of Speech, Religion, and Marriage are three of the some of the most familiar rights that American’s possess today. In just a few years, starting in 2009, the ground shook with protestors as they lined the steps of the United States Supreme Court demanding the right to marry and be recognized as a couple by government.

Though the battle continued over a course of time until June 26, 2013, when the law was passed that same-sex couples had the right to marry. This was a tremendous change rapidly sweeping throughout the country. As of today there are 37 states that have legalized gay marriage, while the remaining 13 states still have a same-sex marriage ban. Although same-sex couples had the right to marry, couples were still not being recognized by government. Taxation laws prevented same-sex married couples the benefit of filing jointly with their spouses and deductions when preparing taxes for the year.

On August 29, 2013 the United States Department of Treasury proclaimed that when same-sex couples file taxes not only will they be recognized, but be recognized even if they’re in a state that has not legalized same-sex marriage. The LGBT community celebrated profusely being that this was the most political progress they had over a short course of time.


The United States Treasury laid out a well-organized, step-by-step policy for the IRS in same-sex couple taxation. Included in this policy were the benefits, responsibilities, and certain protections under federal tax law. Of course, with this policy came a few limitations such as only recognizing married couples vs. those that are only in a domestic partnership. Couples who are filing for the year 2014 may want to read up on frequently asked questions for same-sex couples on tax law on This information provides understanding of what the limitations are and are not on the taxation for same-sex couples.

Employers of a same-sex spouse sometimes provide health coverage in the employee’s gross income. Now, same-sex couples can file an amended 1040 form to recover the value of their health coverage paid for a spouse under a married status. There are still familiar procedures such as if one spouse itemizes deductions on a married filing jointly tax return then the other spouse must do the same. The balance between old and new policies are gradually transforming into a uniform procedure for same-sex couples.

Since same-sex couples now have the right to marry, have been recognized by IRS, and have been able to take advantage of the benefits, responsibilities, and protections under federal tax law they may also adopt children. This means that now same-sex couples may deduct an additional $12,650 in child adoption expenses for the year 2014. Adopting a child can be a strenuous and expensive process that includes courts fees totaling in between $2,000 to $3,000.


Before, only one spouse of a same-sex couple relationship could adopt due to the gay marriage ban, now that gay marriage is legalized taxpayers can file an amended tax form and deduct child adoption expenses from last year.

In protests such as “Every child needs a Mommy and Daddy,” this provided rapid change and increased adoption rates across the United States. Now, when same-sex couples plan to file taxes a child adoption credit will be in place for all of the qualified expenses that come with adopting a child.

Also, same-sex couples will be allowed to recognize the qualified child as a dependent on their taxes if married filing jointly. Same-sex couples who are married filing separately may claim the qualified child as a dependent on the parent’s return who had the child residing with them the longest part of the tax year.

The United States Government has not only opened the door for same-sex married couples, but also helped save billions of dollars for taxpayers that could not have the deduction for married filing jointly couples. An average American couple who file a tax return jointly would have tax due of $11,858 (given all of the household income was provided by one spouse).

Tax impact on $100,000 salary for different married couples

Tax due for heterosexual married couple filing jointly
Tax due for same-sex married couple filing separate single returns
100% income earned by one spouse
90% income earned by one spouse
80%/20% income split

While same-sex couples who had to file separate single returns due to the same-sex marriage ban had taxes due of $19,585. The difference was approximately $7,727 in taxes same-sex couples had to pay due to filing separate single tax returns.

While recognizing the loss of tax dollars spent by same-sex couples now able to file joint returns the United States Government has received a boost to several state economies financially. With the gay marriage ban removed from 37 states more couples are spending money to get married. An estimate of 89,701 same-sex couples will be married within the first three years of legalized marriage.

This financial benefit will provide more funds for state economies on important items such as school funding, scholarships, or other needs for the state. In August of 2014 Michigan’s economic benefit for the first year was over $ 34,100,000 and Texas’ economic benefit was amounted over $ 116,200,000. With this tremendous jump in funds for the United States government it can focus and utilize them on the benefit of society.

When the United States Supreme Court abolished DOMA or Defense of Marriage Act, a well-thought out business investment was considered by government officials. For instance, financial benefits from the uprising funds spent on marriages and providing economic and business opportunities provided a tremendous business investment for the government.

The legalization of gay marriage provided a large new market for business industries. In the first year over $260 million was invested by the New York City economy specifically for gay marriage tourism for couples traveling from another state where gay marriage is illegal to a state where it is legal to obtain a certified marriage document. Many global and national companies have adopted this trait and have now begun to hire more LGBT employees and are now expressing support for equality.

Also, some interesting benefits for the American society as a whole provide better health for citizens. Studies recently show at Michigan State University, that married couples have far better health than unmarried couples. Research data was gathered in this recent study to see how the assumption of healthier same-sex couples impacted before and after the legalization of gay marriage.


After analysis the conclusion was that same-sex married males were 61% more likely to report fair or poor health and same-sex married women were 46% more likely to report fair or poor health. Once compared to heterosexual married couples the statistics were realized that same-sex couples were now healthier since they have earned the right to marry who they love. With this kind of data, it could provide the government with more accuracy in determining the welfare of American citizens and initializing an antidote.

The evolution of same-sex couples is still rapidly evolving to better suit America’s changing society. While evaluating the circumstances and process of adapting the legalization of gay marriage the United States government took into account the benefits and cons. Soon after passing the law for same-sex couple taxation the benefits soared sky-high. Not only providing more funds for our economy, but by providing an overall social well-being.

This would provide more tourism dollars for the United States and income from individuals residing in different countries traveling to enjoy our many and evolving American freedoms.


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