Answers to Frequently Asked Questions for Same-Sex Couples
31 July 2012 / Uncategorized / Comments Off on Answers to Frequently Asked Questions for Same-Sex Couples
Answers to Frequently Asked Questions for Same-Sex Couples
The law in many states now allows for same-sex marriages. As state law allows something that federal law does not allow, this causes a host of issues when it comes to tax time!
The following questions and answers provide some guidance for same-sex domestic partners, same-sex individuals in civil unions and same-sex couples whose marriage is recognized by state law (for convenience, these individuals are referred to as “same-sex couples” and each individual is referred to as a “same-sex partner” in these questions and answers). Below this information are questions and answers for same-sex couples who reside in community property states and are subject to their state’s community property laws:
- Q. Can same-sex partners who are legally married for state law purposes file federal tax returns using a married filing jointly or married filing separately status?
- A. No. Same-sex partners may not file using a married filing separately or jointly filing status because federal law does not treat same-sex partners as married for federal tax purposes.
- Q. Can a taxpayer use the head-of-household filing status if the taxpayer’s only dependent is his or her same-sex partner?
- A. No. A taxpayer cannot file as head of household if the taxpayer’s only dependent is his or her same-sex partner. A taxpayer’s same-sex partner is not one of the related individuals described in the law that qualifies the taxpayer to file as head of household, even if the same-sex partner is the taxpayer’s dependent.
- Q. If a child is a qualifying child of both parents who are same-sex partners, which parent may claim the child as a dependent?
- A. If a child is a qualifying child of both parents who are same-sex partners, either parent, but not both, may claim a dependency deduction for the qualifying child. If both parents claim a dependency deduction for the child on their income tax returns, the IRS will treat the child as the qualifying child of the parent with whom the child resides for the longer period of time. If the child resides with each parent for the same amount of time during the taxable year, the IRS will treat the child as the qualifying child of the parent with the higher adjusted gross income.
- Q. Can a same-sex partner itemize deductions if his or her partner claims a standard deduction?
- A. Yes. A same-sex partner may itemize or claim the standard deduction regardless of whether his or her partner itemizes or claims the standard deduction. Although the law prohibits one spouse from itemizing deductions if the other spouse claims the standard deduction (section 63(c)(6)(A)), same-sex partners are not spouses as defined by federal law, and this provision does not apply to them.
- Q. If a same-sex couple adopts a child together, can one or both of the same-sex partners qualify for the adoption credit?
- A. Yes. Each same-sex partner may qualify to claim the adoption credit on the amount of the qualified adoption expenses paid or incurred for the adoption. The same-sex partners may not both claim credit for the same qualified adoption expenses, and neither same-sex partner may claim more than the amount of expenses that he or she paid or incurred. The adoption credit is limited to $13,360 per child in 2011. Thus, if two same-sex partners each paid qualified adoption expenses to adopt the same child, and the total of those expenses exceeds $13,360, the maximum credit available for the adoption is $13,360. The same-sex partners may allocate this maximum between them in any way they agree, but the amount allocated to a same-sex partner may not be more than the amount of expenses he or she paid or incurred.
- Q. If a taxpayer adopts the child of his or her same-sex partner, may the taxpayer (“adopting parent”) claim the adoption credit for the qualifying adoption expenses he or she pays or incurs to adopt the child?
- A. Yes. The adopting parent may claim an adoption credit to the extent provided under the law. The law does not allow taxpayers to claim an adoption credit for expenses incurred in adopting the child of the taxpayer’s spouse. However, this limitation does not apply to adoptions by same-sex partners because same-sex partners, even if married for state law purposes, are not treated as spouses under federal law.
- Q. Is a same-sex partner the stepparent of his or her partner’s child?
- A. If a same-sex partner is the stepparent of his or her partner’s child under the laws of the state in which the partners reside, then the same-sex partner is the stepparent of the child for federal income tax purposes.
Same-sex couples have many issues that they need to deal with before they even think about thier taxes and the tax treatment of the children they adopt together. Let Widget help you with these issues and make your life just a little easier!