On June 26, 2013, the Supreme Court of the United States struck down the federal Defense of Marriage Act (DOMA) by declaring it unconstitutional. In the case, United States v. Windsor, the Supreme Court ruled that same-sex couples living in the states that recognize their marriage are entitled to receive the same federal benefits as any other married couple in those states.
This important ruling has myriad implications and touches upon many areas of law affecting same-sex couples across the country. For example, estate plans for same-sex couples were previously drafted to take advantage of benefits available within the 13 states and the District of Columbia that recognize same-sex marriage; nevertheless, estate plans had to be drafted around DOMA, which denied same-sex couples the benefits afforded other married couples under federal law. With yesterday's Windsor decision, the door has been opened for same-sex couples living in those states that allow same-sex marriage to take advantage of the federal estate planning opportunities afforded by straight couples, such as estate tax planning and retirement benefit planning. Same-sex spouses may need to rethink their wealth management strategies and estate plans in order to redistribute wealth, change beneficiary designations and amend estate plans. Same-sex couples may also want to consider establishing domicile in a state that allows for same sex marriage, as well as consider amending past tax return filings.
The federal government will still deny most federal benefits to same-sex couples living in the 37 states that don't allow same-sex marriage, and for same-sex married couples who relocate or travel to a state that does not allow same-sex marriage. Importantly, this decision creates new complexities for divorcing same-sex couples given the continued lack of portability of same-sex marriages and the incongruent availability of federal and state benefits for same-sex spouses. Only those same-sex couples who are married in states that permit gay couples to marry, and who remain residents of such states, will now participate in the full panoply of federal and state rights, protections and obligations enjoyed by other married spouses. But if a couple marries in Massachusetts, for example, and relocates to a state that has a state DOMA law, the federal government will not recognize the marriage. Crossing state lines will mean that the couple may not be able to secure a divorce if needed, and even if a divorce were somehow granted by a state with a DOMA law, assets divided incident to the divorce will not be subject to tax protections and advantages that other divorcing spouses receive.
Additional implications for same-sex couples resulting from yesterday's decision relate to Social Security benefits, VA benefits, immigration issues, ERISA and health insurance benefits.
As we watch these historic events unfold and analyze their impact on our clients, Burns & Levinson attorneys stand ready to work with you to incorporate the effects of yesterday's important decision into your personal estate and tax planning. Please contact your Burns & Levinson attorney today to discuss how the fall of DOMA may affect you and your family, and stay tuned for additional updates.
For more information or questions regarding this Client Update, please contact:
Lisa M. Cukier
617.345.3471 / firstname.lastname@example.org
Christine N. Fletcher
617.345.3607 / email@example.com