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Supreme Court Ruling Narrows the Benefits Gap for Same-Sex Spouses

Posted Jul 01 2013 11:33am
Since January 1, same-sex couples have been able to marry in Maryland . However, the Defense of Marriage Act (DOMA) loomed over newlyweds limiting the benefits they could receive from being married. Last week, the Supreme Court leveled the playing field by declaring DOMA unconstitutional. Many employers applaud the ruling because it provides administrative relief to those of us that already offer spousal benefits to same-sex married couples. The impact will be broad and effect employer sponsored benefits in many ways including:

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  • Same-sex married couples will be able to file joint federal tax returns and they will no longer be liable to pay estate taxes on property they receive if their spouse dies. 
  • Employers will be required to extend the same benefits to same-sex spouses that they extend to opposite-sex spouses. However, organizations that self-insure their health insurance do not have to comply with state insurance law mandates. If employers that are self-insured decide not to provide the same health care coverage to same-sex spouses that they do to opposite-sex spouses, they are likely to face challenges of discrimination now. 
  • Employees with same-sex spouses will no longer have to pay federal income taxes on the value of the employer's contribution to their spouses' medical, dental and vision coverage. Same-sex spouses will be able to pay for their coverage on a pretax basis under Section 125 plans. They will also be able to share money in a FSA, HRA and HSA.
  • Employers will now have to offer COBRA coverage to same-sex spouses when their coverage ends. 
  • Pension plans will now have to recognize same-sex spouses when determining surviving spouse annuities. 401(k) plans will also need to treat same and opposite-sex spouses equally. 
  • Family and Medical Leave can now be taken by same-sex spouses to care for one another when necessary. 
  • I've read that there are more than 1,000 federal benefits that involve marital status. I'm obviously just hitting on some of the key items that have impact in the workplace. 

    Questions that remain:
    • Can same-sex spouses claim some of these benefits retroactively e.g., can they amend previous years' tax returns?
    • If a couple was legally married in one state, but currently resides in another that does not recognize same-sex marriages, which state law governs? 
    • How are employers with employees residing in multiple states going to handle eligibility?
    • How quickly must employers revise their plans and policies to include same-sex spouses?
    Next steps for employers:

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