In my practice, two-thirds of my clients in same-sex marriages will actually owe more in taxes by filing as married. So the question comes up often of, will couples in that situation — who properly filed their taxes as unmarried in the past and who benefited from doing so — be REQUIRED to amend those prior years and pay additional taxes?
Based on the IRS guidance issued today, the answer is no. Amending prior years is optional.
Couples who would have benefited from filing as married in prior years can amend (as far back as 2010) if they choose to do so. But amending is optional, not required.
Starting with 2013 returns (and any amended returns filed after September 16 , 2013), couples in same-sex marriages must file as married. But there is no requirement to amend prior years.
[…] Lot’s of coverage of this in the tax blog world. Iowa’s own Jason Dinesen has long owned this issue, and he comes through with BREAKING: IRS Releases Guidance on Same-Sex Marriage , The IRS’s DOMA Guidance: How are Iowa Returns Affected?, What if One Spouse in a Same-Sex Marriage Hasn’t Filed Yet? and Will Same-Sex Married Couples Be Required to Amend? […]
Jason-
As you (may) know, we run a coalition of VITA (Volunteer Income Tax Assistance) sites and help individuals file taxes. I understand what you are saying about it not making sense for same-sex spouses to go back and file amended returns as they may have to pay more. Here is my question: Does it make sense for same sex spouses who made less than $57,000 jointly? VITA is for low income individuals and I wonder if there could be a scenario wherein a low-income family may qualify for a greater federal return or even the EITC.
Thanks!
Amelia – yes, I do know about the VITA/ISED connection. Unfortunately, there’s not an easy answer to your question. The answer is “maybe.” Typically, the folks who will benefit from filing jointly are those with an income disparity between couples (one spouse has high income, one spouse has low income). But that won’t necessarily be true if kids are involved and the “low income” spouse was claiming one or more of the kids and the earned income credit.
The EITC for a married couple with 3 kids is reduced to $0 at just over $50,000 of income. For a couple with 2 kids, the limit is just over $47,000. So if combined income is above those amounts, the EITC is off the table.
So one way of answering your question is to say: it depends, and the answer will vary from couple to couple.
Hopefully this helps!