Since the landmark Supreme Court decision in June, readers have asked us a wide variety of questions about taxes and immigration that we’ve unfortunately been unable to answer . . . until now.

With tax time right around the corner, O&AN caught up with Joyce Peacock of Peacock Financial to talk about the implications of a post-DOMA world on your taxes We also asked Yvette Sebelist from Siskind Susser PC-Immigration Lawyers about what the implications of a post-DOMA world is for binational couples living in Nashville.

 

What does the DOMA ruling mean for your taxes?

By now you have certainly heard about the overturning of DOMA by the U.S. Supreme Court in June of this year.  But what exactly was DOMA and what does the Supreme Court action mean to us?

DOMA refers to the Defense of Marriage Act which was passed in 1996 by Congress and signed into law by President Bill Clinton.  The U.S. Supreme Court specifically struck down Section 3 of this law which stated that for federal purposes and laws, “ the word ‘marriage’ means only a legal union between one man and one woman as husband and wife, and the word ‘spouse’ refers only to a person of the opposite sex who is a husband or a wife.”  This provision of the law prevented the federal government from recognizing legally married same-sex couples and according them the benefits available to other married couples.

By declaring this section of the law unconstitutional, the Court opened the door for sweeping change in the lives of LGBT couples.  Never before have we been granted so many legal protections and benefits in so brief a time.  Let’s look at some of them:

Tax Law:

-Effective immediately, all legally married couples must file as married on all future federal tax returns.

-Amended returns may be filed back to 2010 if doing so will benefit the couple.

-All tax provisions affected by marital status will now apply to married same sex couples (there are over 700 of them).

-This provision applies to all legally married couples regardless of whether their current state of residence recognizes the marriage.  Thus, couples may be married for federal purposes but not state.

-Married couples must file jointly to claim rental losses, education credits, student loan interest, dependent care benefits, child credits and the earned income credit.

-Same-sex surviving spouses will be exempt from estate taxes.

 

Employer Benefits: 

-Married couples will no longer be taxed on domestic partner benefits.

-Employers may file amended payroll tax returns to recover FICA taxes paid on past domestic partner benefits.

 

Retirement Benefits: 

-Federal and military pension benefits and protections will be extended to same-sex spouses.

-IRA contributions will be permitted for non-working same-sex spouses.

-Social security benefits may be available to widows and widowers.  However, in most cases, the couples must live in a recognizing state at the time of application.

 

Other Protections:

-Same-sex married couples may now file a joint petition of bankruptcy.

-Binational same-sex couples now have the same rights and benefits as other married couples regarding immigration and citizenship issues.

-Same-sex spouses receive rights to creative and intellectual property.

-FAFSA rules will be applied the same as for all married couples.

We are just beginning to understand the broad spectrum of change affected by this historic ruling and the interpretation of it by our federal administration.  The over-turning of DOMA has been a monumental move forward for equality.  Hopefully, the momentum will continue as more and more states affirm justice for all loving couples.

 

US Immigration Opens the Door for Binational Same-Sex Spouses

For Steven Brooks, a Colombian man married to his U.S. citizen partner, the Supreme Court’s decision to strike down the Defense of Marriage Act (DOMA) couldn’t have come at a better time. Brooks was in the middle of deportation proceedings when an intern from his lawyer’s office brought a copy of the ruling to the courtroom. New York City immigration judge Barbara Nelson adjourned the hearing, and now the petition for permanent residency that Brooks’ husband, Sean, filed for him in 2011 will finally receive due consideration.

Immigration benefits are chief among the many entitlements DOMA restricted to straight, married couples. It was Section 3 of DOMA, which denied more than a thousand federal benefits to same-sex partners, that prohibited the U.S. Citizenship and Immigration Services (USCIS) from recognizing gay and lesbian marriages as beneficiaries of family-based visas. Since the Supreme Court found Section 3 unconstitutional, USCIS has moved swiftly to ensure that foreign born spouses in same-sex marriages are given appropriate attention.

The Secretary of the Department of Homeland Security (DHS), Janet Napolitano, immediately issued a directive to USCIS to review the cases of all married couples equally and fairly. USCIS has kept a record of same-sex spouses whose petitions were denied over the last two years, and these decisions will now be reversed for applicants who meet the standard qualifications for permanent residency.

Just two days after DOMA was overturned, the first green card was granted to an American citizen’s same-sex partner. Although the recipient, Traian Popov, and his spouse live in Fort Lauderdale, Florida where same-sex marriage remains prohibited, state laws had no effect on the outcome of their case. So long as a marriage is valid in the place where it is performed it will now be recognized for immigration purposes.

The Supreme Court’s ruling on DOMA has had a significant, positive impact for people like Steven Brooks and Traian Popov, but a number of issues remain unresolved for American citizens and their partners in binational, same-sex relationships. Some of these matters are primarily logistical. Adjudication under immigration law involves several agencies within DHS (i.e. USCIS, Customs and Border Patrol, and Immigration and Customs Enforcement), as well as U.S. consulates throughout the world. It will take time to develop practical guidelines for reviewing a greater volume and wider variety of petitions across the board.

Other problems are more direct. Guidance issued by DHS refers specifically to family-based immigrant petitions filed on behalf of same-sex spouses. It fails to address employment-based or non-immigrant petitions, which would make partners eligible for dependent or derivative status. However, the Department of State has provided same-sex benefits to employees since 2009 and is expected to facilitate visas for the spouses of authorized immigrant and non-immigrant workers. Civil unions and domestic partnerships are still unrecognized on the federal level and so continue to be excluded from consideration for immigration benefits. Until these issues are resolved we may find that some same-sex petitions are met with delays, confusion, lack of consistency, and perhaps rejections.

Further, with new benefits come new obstacles, and it may be particularly difficult for same-sex couples to provide documentation of their lives together. All green card applicants who file based on marriage to a U.S. citizen must submit proof that their relationship was entered into in good faith and not merely for the purpose of gaining lawful status.  Start by collecting proof of your courtship, family life, joint insurance policies or finances, common residence, and shared property. Meeting this condition can be challenging for some gay and lesbian spouses, as social barriers have often discouraged couples from sharing finances, living together, or raising children. Because same-sex marriages remain unrecognized in Tennessee, individuals who want to change state documents to reflect their married name are being denied driver licenses. It presently takes a court order for a spouse in a gay or lesbian marriage to obtain a new license.  Other kinds of evidence, like jointly filed income taxes, are just now possible to obtain.

Despite these difficulties, same-sex couples have already begun to benefit from the new immigration opportunities. USCIS has approved family petitions for same-sex couples in a steady stream since DOMA was overturned and past applications that were denied solely because of DOMA are being reopened and reconsidered.

Moving forward, it is important to take the initiative if you or your spouse are eligible for marriage-based immigration benefits. Couples may marry in any marriage equality state or country, reside in Tennessee and still obtain immigration benefits.  Since new waters are being tested, it is important to seek legal counsel before taking steps to file for permanent residency and begin the application process.  And as with any case, it is important to seek expert legal advice to determine whether your foreign national spouse meets the other general requirements to obtain status.

 

For more information or questions, Joyce Peacock and Peacock Financial can be found online at www.peacockfinancial.com and Yvette Sebelist and the law offices of Siskind Susser can be found online at www.visalaw.com/nashville.html

 

 

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