September 13, 2016

Final IRS Regulations Update Definition of Marriage

Contributor Portia Rose, Senior Manager, Tax & Business Services

Final IRS Regulations Update Definition of Marriage Modern Family & LGBTQ Services

The IRS has issued final regulations re-defining marriage to be inclusive of same-sex spouses, following the 2015 Supreme Court decision legalizing same-sex marriage in all 50 states.

The final regulations set forth that the term “marriage” is defined for federal tax purposes as two individuals lawfully married to each other. A “spouse,” a “husband” and a “wife” are individuals lawfully married to another individual, and the term “husband and wife” means two individuals lawfully married to each other. There is no separate designation or clarification defining “same-sex” and/or “opposite-sex” couples.

In addition, the regulations provide that a marriage of two individuals is recognized for federal tax purposes if that marriage is recognized by any state, possession or territory of the U.S. The regulations clarify that the term “marriage” does not include registered domestic partnerships, civil unions, or similar relationships recognized under state law that are not denominated as a marriage under that state’s law, and the terms “spouse,” “husband and wife,” “husband,” and “wife” do not include individuals who have entered into such a relationship.

The 2013 Supreme Court case of Windsor v US was a landmark civil rights case that struck down the federal interpretation of “marriage” and “spouse” only to heterosexual unions. In the 2015 case of Obergefell v. Hodges, the Supreme Court went several steps further, deciding that the fundamental right to marry is guaranteed to same-sex couples by both the Due Process Clause and the Equal Protection Clause – effectively legalizing same-sex marriage in every state.

The IRS has caught up with the judicial interpretation by issuing the final regulations on September 2. The final regulations amend all tax platforms including Income Tax, Estate Tax, Gift Tax, Generational Skipping Tax, Employment Tax and Collection of Income Tax as Source Regulations and the Regulations on Procedure and Administration.

Contact your Marcum tax professional to discuss how this IRS position may affect your individual tax situation.

Marcum is the thought-leader in the specialty area of tax compliance and consulting services for high net worth modern families, same-sex couples and LGBT individuals. The Firm’s specialists have over 20 years of experience navigating the complex, hyper-local and shifting tax landscape for the modern family in America. In 2012, Marcum became the first national accounting firm to establish a tax and estate planning practice dedicated to the complex rules faced by people who don’t fit traditional definitions.