The Internal Revenue Service announced last week that legally married same-sex couples will be also be considered married for federal tax purposes and be eligible for tax relief.
This provision applies irrespective of whether the couple lives in a state that recognizes same-sex marriage or a state that does not. Therefore, if a same-sex couple was legally married in a state that recognizes such marriages and subsequently moves to a state that does not recognize the marriage, they will be considered married by the IRS.
The IRS will treat these couples as married for federal tax purposes such as income, estate and gift taxes. Thus, the ruling will apply to income tax matters where marriage is a factor. Several of these matters include filing status, personal and dependency exemptions, IRA contributions, and child tax credit.
If you are a legally married same-sex couple you will be required to file your 2013 federal income tax return either as married filing jointly or married filing separately. You may be eligible to file amended tax returns for prior years to benefit from married status. As long as a prior tax year remains open under the statute of limitations you may file an amended return. The statute of limitations for filing an amended return and claiming a refund is normally three years from the date original return was filed or two years from the date the tax was paid, whichever comes later. Form 1040X is used to file an amended return.
The IRS will issue future guidance for businesses who want to file refund claims for payroll taxes paid on health insurance and fringe benefits provided to same-sex couples that were previously taxed.
If you believe you may benefit from the new same-sex couple tax relief rules, please contact the professionals at East Coast Tax Consulting Group for a free consultation.