Sep

25

Same Sex Domestic Woes

September 25, 2006 |

Massachusetts is the only state same sex couples can legally marry. Some states however in states that recognize some form of same sex marriage new legal questions are arising. A whole new client base is being built for the new legal situations. Ahhhh… the lawyers dream. Breaking ground just looking for pioneers to help the couples… former couples…. to weave their way through something the law isn’t clear on yet.

In California, since January 2000, nearly 39,000 couples have registered with the secretary of state as domestic partnerships, a designation open to gay and lesbian couples and some seniors. For the first few years, domestic partners who wanted to break up filed a simple notice of termination with the secretary of state.

But that changed in January 2005 when AB205, the Registered Domestic Partners Rights and Responsibilities Act, took effect. Most partnerships now have to go through divorce proceedings, just like married couples, with a few exceptions.

Many of the problems arise when ex-partners calculate their federal income taxes. For example, a California judge might order one to regularly pay the other a certain amount of money, like alimony. But, because the federal government does not recognize same-sex couples, the Internal Revenue Code treats that income as a gift and taxes it at a higher level than alimony. And, although alimony payments are deductible for straight ex-spouses, someone who has left a same-sex union can’t take that deduction.

Similarly unsettled issues arise with pensions, retirement accounts and other property. Attorneys and accountants have yet to see what will happen when a couple returns to California to end a partnership and the state court divides property they owned in another state, for instance.

The courts are just getting into new territory. Though the Federal government doesn’t recognize same sex marriage the forces to be will begin working on legal precedent until the government is forced to do so. Or at least until enough people think the contradiction between reality and law seem don’t seem defensible any longer.

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