United States: Revenue Ruling Confirms That IRS Will Recognize Same-Sex Marriages, But Not Civil Unions Or Registered Domestic Partnerships

Shani Levitan is a Partner in our Boston. office

The recent U.S. Supreme Court decision inUnited States v. Windsor overturning Section 3 of the Defense of Marriage Act (DOMA) raised several questions regarding the federal tax treatment of same-sex couples. (See Holland & Knight Private Wealth Services alert, " United States v. Windsor: A New Direction in Planning for Same-Sex Couples," July 9, 2013.) A chief concern under the text of the decision was whether same-sex couples who were legally married in a domestic or foreign jurisdiction would be recognized as married for federal tax purposes — even if they subsequently moved to a state that did not recognize their union. In addition, the Windsor decision applied only to marriage — it did not address civil unions or domestic partnerships, leaving uncertainty as to the federal recognition of these relationships. On August 29, 2013, the Department of Treasury issued guidance on these questions and provided practical direction for same-sex couples filing tax returns.

Marital Status Will Be Uniform, Regardless of State of Residence

As part of that guidance, Revenue Ruling 2013-17 confirmed that same sex-marriages validly entered into in a domestic or foreign jurisdiction will be recognized for federal tax purposes. Relying on a 1958 ruling that recognized common law marriage if valid where formed, the Internal Revenue Service cited the need for uniform nationwide rules as "essential for efficient and fair tax administration" for federal tax purposes. The IRS stated that a rule in which a couple's marital status could change depending on their state of residence would be unduly difficult to follow. Accordingly, wherever the terms "husband and wife," "husband" and "wife" appear in the Internal Revenue Code, they will be construed in a gender neutral manner to refer to "spouse." As a result, a same-sex marriage that was validly entered into will be recognized for federal tax purposes, regardless of the couple's place of domicile.

The Revenue Ruling affirmatively answers an important question for couples who reside in a state that does not recognize their marriage: for federal tax purposes, their marriage will continue to be recognized. While some of the implications of the ruling may be obvious — i.e., couples may file joint income tax returns, take advantage of the unlimited marital deduction for gift and estate tax purposes, and avail themselves of estate planning techniques that are limited to "married" couples — others are more subtle. For example, there is no longer a generation-skipping transfer tax imposed on a gift to a significantly younger spouse or to the spouse of a child. This result will hold true regardless of where the donor resides.

Alternative Arrangements Not Recognized

The Windsor decision did not, however, grant recognition to alternative arrangements to marriage, such as civil unions or domestic partnerships, even if the state legislation provides that such designation confers all benefits of marriage. The Revenue Ruling confirmed that couples joined in a legal relationship that is not "denominated as a marriage under the laws of that state" will not be treated as married for federal tax purposes.

Treasury's Release Addresses Practical Issues

In addition to the ruling, Treasury Secretary Lew also issued a release addressing certain practical issues concerning tax filing obligations of same-sex married couples and the ability to amend previously filed returns: 

  1. Married couples must file as such, either jointly or separately, beginning with calendar year 2013.
  2. Couples may, but need not, file original or amended returns for one or more prior years that are open under the statute of limitations. For the purpose of determining whether a return may be amended or a refund collected, the three-year statute of limitations will apply, unless an individual taxpayer had an agreement with the IRS to keep an earlier return open. Couples should consult their tax preparers to assess whether they would benefit from amending any prior returns. By providing that couples may amend returns for "one or more" prior open years, the release appears to allow couples to amend for those years in which they would enjoy a tax benefit, and to leave other returns as originally filed.
  3. Employees who purchased health insurance for a spouse on an after-tax basis may treat the premium cost as a pre-tax amount, excludable from income. Further guidance for employers seeking refunds relating to benefits programs will be forthcoming.

Many Complex Questions Remain Unanswered

The release augments the ruling with clear direction to taxpayers seeking to avail themselves of potential tax benefits under the Windsor decision. Nonetheless, the IRS acknowledged in the ruling that the application of Windsor will likely require further guidance, and that other federal agencies will need to address programs they administer. Some of the remaining open questions include:

  • In states that do not recognize the marriage of their resident same-sex couples:
    • Will the state permit couples to file joint state income tax returns, or will these couples file jointly for federal purposes and singly for state purposes? The state of Arizona, for example, has advised couples that they will not be permitted to file jointly for state purposes.
    • Will the same result hold in all states, or will it be limited to states that do not require the same filing status as the federal return? 1
    • Will the IRS permit a deduction for a larger state income tax obligation based on the single filing status?
  • Favorable federal income tax treatment will be permitted for alimony payments and property settlement on divorce. Couples who had previously separated but not divorced — including couples living in states that do not recognize their marriage and therefore refuse to grant divorce — now have reason to legally sever their relationships. Will states require adjustments to the tax treatment of these alimony and property settlement payments?
  • The guidance issued by the IRS is not binding on other federal agencies. A number of federal programs are either administered by the states (i.e., Medicaid) or look to state law in determining marital status (i.e., Social Security). 2 Must the states acknowledge federal recognition of a marriage in these cases? Will there be a distinction between being married for purposes of federal law as opposed to state law?
  • How will federal recognition impact the gift and estate tax liability of couples who live in a state that does not recognize their marriage?
    • Can state estate taxes be paid from a QTIP Marital Trust without jeopardizing the federal marital deduction? Assuming payment of tax from the QTIP Marital Trust would jeopardize the marital deduction, the overall tax would be increased: any tax paid would be ineligible for the marital deduction, thus further increasing the taxable amount and creating a tax on the tax. The result is an interrelated calculation that significantly increases the tax due. This issue applies both to couples who live in a state that does not recognize their marriage, as well as those who own real estate in such a state.
    • Irrevocable trusts that have the spouse as a beneficiary will be treated as "grantor trusts" for federal income tax purposes. If the state of residence does not recognize the marriage, will the trust be treated as a non-grantor trust for state income tax purposes?
    • Federal tax laws permit favorable disclaimer provisions for a surviving spouse, but disclaimers will be scrutinized under state law as well. Will the state rules recognize the marriage? 
  • Further guidance has yet to be released regarding rollover of retirement plan balances by a surviving spouse and other elections governed by the ERISA rules.

While this initial guidance clarifies the main questions following Windsor, a host of complex issues remain. Many of the states that recognize same-sex marriage are also high-tax jurisdictions, both with respect to income and estate taxes. On the other hand, many of the low-tax jurisdictions do not recognize same-sex marriage. This presents additional complications for couples who may want (or need) to change their domicile. As a result, many couples will continue to grapple with uncertainty or inconsistent recognition of their relationships.

For more information about how Windsor and subsequent guidance affects tax and other issues, please contact the authors of this alert or your Holland & Knight lawyer.  


1 Ohio, for example, requires that the state filing status be consistent with federal filing status. In that state, however, same-sex marriage is constitutionally prohibited, making it impossible to comply since the federal government now requires filing as "married."

2 Under 42 U.S.C. 416(h)(1)(A), a survivor is a "husband" or "wife" of a decedent if a state court in the state of domicile would determine them to be validly married, or if state intestacy laws would determine them to be married.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.