All posts tagged same-sex marriage

0527From 2013 to 2015, a series of Supreme Court cases and government updates have changed the landscape of the way employers must consider same-sex spouses in relation to employee benefits.

Most recently, in June 2015, the Supreme Court ruled in Obergefell v. Hodges, that the 14th Amendment requires a state to license a marriage between two people of the same sex, and to recognize a marriage between two people of the same sex when their marriage was lawfully licensed and performed out of state. Prior to the Supreme Court’s decision in Obergefell v. Hodges, approximately two-thirds of states recognized same-sex marriage (whether performed within the state or another state or country that recognizes same-sex marriage).

In February 2015, the Department of Labor (DOL) issued an updated definition of “spouse” under the Family and Medical Leave Act (FMLA) to make compliance easier, and defined “spouse” as a husband or wife, which refers to a person “with whom an individual entered into marriage as defined or recognized by state law.” The governing state law is that of the celebration state, or where the marriage took place. This definition was set to go into effect across the United States on March 27, 2015, but litigation in Texas, Arkansas, Louisiana, and Nebraska prevented the new rule from going into effect in those states immediately. After the ruling in Obergefell, which severely undermined the arguments of the objecting states, the injunction was dissolved.

In June 2013, the Supreme Court ruled that the Defense of Marriage Act (DOMA), which provided that, for federal law purposes, marriage could only be between a man and a woman, was unconstitutional.

Implication for Employers

For individuals with a same-sex spouse (validly married in a state allowing same-sex marriage) who reside in a state that did not previously recognize same-sex-marriage, the ruling in Obergefell likely triggered a change in status event for Section 125 plans. That is because, as of June 26, 2015, the individual was considered married under state law, whereas they were not the day before.

As a result of these changes, employers need to review the eligibility requirements in their group life and health plans, Section 125 plans, and health reimbursement arrangements. The Employee Retirement Income and Security Act (ERISA) requires employers to administer their plans according to the terms of the plan, which means that the plan’s definition of a covered spouse is key. A plan that covers “spouses” or “lawful spouses” must offer coverage to same-sex spouses.

While most practitioners agree that fully insured plans are required to cover same-sex spouses, employers should contact their carrier to verify this approach.

Download UBA’s Compliance Advisor, “Same-Sex Marriages and Group Health Benefits” for comprehensive information on tax treatment of same-sex spouses, FMLA administration, and whether self-funded plans may exclude same-sex spouses.

The IRS has issued Frequently Asked Questions that employers and employees may also find helpful. The questions and answers that relate to benefits begin with Question 10.

Originally published by United Benefit Advisors – Read More

IRS Provides Process to Correct Over-Withholding of Same-Sex Spouse Benefits

Categories: Compliance News, Team K Blog
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Check out the latest updates on same-sex souse benefits from the IRS and the process that goes along with making refund claims or internal adjustments of FICA and FIT that was withheld or paid in connection with same-sex spouse benefits. Read more

All Legal Same-Sex Marriages Will Be Recognized for Federal Tax Purposes

Categories: Team K Blog
Comments Off on All Legal Same-Sex Marriages Will Be Recognized for Federal Tax Purposes
The U.S. Department of the Treasury and the Internal Revenue Service (IRS) ruled that same-sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes. Read full article... Read more