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In 1964 Bob Dylan sang “The times, they are a changin’”.  Those words ring as true today as they did back then.  This past week, the Internal Revenue Service (IRS) and the United States Department of Treasury released a joint ruling that stated:

Same sex couples, legally married in jurisdictions that recognize their marriages, will be treated as married for federal tax purposes.

Whether you currently live in a state that recognizes same-sex marriage, or one that does not makes no difference, the federal government of the United States of America will recognize your marriage for all tax purposes.

So what does that mean?  It means that all legally married same-sex couples will have clear and unambiguous tax filing guidance across the country.  So, if any same-sex married couple wants to move to another state, any state, their status for filing federal taxes won’t change.  It also provides access to all the benefits, protections and responsibilities available under federal tax law.  This policy change by the IRS and Treasury Department also means that when legally married same-sex couples file their taxes, every category that allows a distinction for being married, including; personal and dependency deductions, contributing to an IRA or other qualified plan, the earned income credit, child tax credit, employee benefits and standard deductions, the same-sex married couple can file either married, filing jointly or married, filing separately.

There’s even more good news: the IRS has a three-year “look-back” policy, so as a same-sex couple that has been legally married for any of that time, you are entitled to file amended returns for each year that qualifies.   There is no obligation to file amended returns but it may be well worth it, if it puts more money back in your pocket!

One thing to keep in mind, though, is that this ruling DOES NOT apply to registered domestic partnerships, civil unions or similar formal relationships recognized under state laws.  Only couples legally married in one of the 50 states, the District of Columbia, any U.S. territory or a foreign country can benefit from this new rule.

This latest ruling comes on the heels of an announcement by the Department of Defense (DOD) extending benefits to same-sex spouses and civilian employees.  There is rapid change happening in how the federal government is viewing same-sex marriages and it doesn’t look as if it is going to stop here.  Important decisions await in Social Security, Medicare, Medicaid and a host of other regulatory areas that factor in one’s marital status.

The challenge will be for married same-sex couples to navigate all of these changes in the law to maximize the benefit to them and take full advantage as they manage their estate planning to ensure that their families are taken care of and their wishes are carried out.

At Tiboni & Tiboni, we can help you understand the changes, explain how they affect you and your family and help you create an estate plan that maximizes these new benefits.  The times they are a-changin’, with more changes to come.  Every family is unique. Let us assist you, in these exciting times, in crafting a custom estate plan that addresses your family’s specific needs.

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About the Movie
Win Win is based on the story by Tom McCarthy and Joe Tiboni. When a disheartened attorney moonlighting as a high school wrestling coach stumbles across a star athlete, things seem to be looking up. That is, until the boy's mother shows up fresh from rehab and flat broke, threatening to derail everything. Cast: Paul Giamatti, Amy Ryan, Bobby Cannavale, Jeffrey Tambor.
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Tiboni & Tiboni, LLP
166 South Street
New Providence, NJ 07974
Ph: 908-286-1136
Fax: 908-286-1605