The Supreme Court and Same-Sex Marriage: What's at Stake for Older Gay Couples

Courtesy SAGE

Edie Windsor (left) and her partner of more than 40 years, Thea Spyer, married in 2007. Two years later Spyer passed away. Under federal law a surviving spouse does not pay estate taxes. Because the Defense of Marriage Act prohibits the federal recognition of same-sex marriage, Windsor, now 83, received a tax bill for more than $350,000.

The U.S. Supreme Court wades into the national debate over same-sex marriage on March 26 and 27, when it hears a pair of cases challenging state and federal laws that limit the definition of marriage to unions of a man and a woman.

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At issue in the first case is whether California voters violated the U.S. Constitution when they amended the state constitution so that "only marriage between a man and a woman is valid or recognized in California. The other case challenges the 1996 Defense of Marriage Act (DOMA), which requires the federal government to deny benefits to gay and lesbian couples married in states that allow same-sex unions.

The issue of marriage equality has particular importance for older gay and lesbian couples. The plaintiff in the challenge to DOMA, for example, is Edie Windsor, 83. After her same-sex spouse died, the federal government refused to recognize their marriage in taxing Windsor's inheritance.

To help you make sense of it all, we've broken down the issues into the following questions and answers.

Why would the Supreme Court's rulings be especially important for older couples?
In many ways, DOMA's definition of marriage applies to more than 1,000 federal laws and programs. Many of the benefits denied by DOMA are in place to protect older people from economic insecurity in the face of serious illness or the death of a spouse.

What's a specific example?
Consider Social Security benefits for spouses. If one spouse in a heterosexual marriage works and the other doesn't, the nonworking spouse still receives Social Security benefits — 50 percent of what the working spouse receives. Same-sex couples are denied those benefits.

Wasn't the "spousal benefit" put into place to protect spouses who stay at home to raise families?
Yes, but many same-sex couples raise children. If one spouse doesn't work, he or she receives no spousal benefit.

And the same is true for Social Security survivor benefits?
That's right. If a working spouse in a heterosexual marriage dies, the nonworking spouse receives the partner's full Social Security benefits. A surviving spouse who earns less in Social Security automatically qualifies for the deceased spouse's higher benefit. Even ex-spouses qualify — as long as the couple is a man and a woman.

Does the IRS recognize same-sex marriages?
No. As far as federal tax law is concerned, there are only heterosexual marriages.

How does that affect filing taxes?
Same-sex married couples typically have to create two sets of income tax returns: one for the state, which recognizes their marriage, and another for the federal government, which doesn't. They often have to pay more in taxes, as well. When an employer extends benefits such as health insurance to a heterosexual spouse, for example, the value of those benefits is not taxable. Same-sex spouses must pay taxes.

And when a same-sex spouse dies?
Property passes automatically to a surviving spouse in a heterosexual marriage. Not so for same-sex couples; many must make complex and often expensive legal arrangements to ensure that decision-making and inheritance pass to a surviving spouse. And even then, the taxes are heavier. A heterosexual spouse who dies can leave assets, including the family home, to the surviving spouse without incurring estate taxes. A same-sex inheritor is taxed just as a stranger would be.

Is that the issue at hand in Edie Windsor's challenge to DOMA?
Yes, it is.

Next page: More benefits heterosexual couples receive that married same-sex couples don't. »

How do Medicaid long-term care benefits compare for heterosexual and same-sex married couples?
They're completely different. When a heterosexual spouse becomes seriously ill or incapacitated and requires long-term care, Medicaid policies are designed to prevent the healthy spouse from being impoverished by the high costs of such care. If one spouse enters a nursing home, for example, the other spouse can keep the couple's home, household goods and one car. Same-sex couples don't have this protection. A same-sex spouse risks losing it all, depending on who officially owns the property.

Do Medicare benefits differ for heterosexual and same-sex couples?
They can. Eligibility for full Medicare benefits is based on a person's employment history or, in some circumstances, on the employment history of his or her spouse. Because of DOMA, this option is not available to same-sex couples.

President Obama ended the "don't ask, don't tell" policy that prevented gay people from serving openly in the military. Didn't that make the same-sex spouses of veterans eligible for benefits?
No. Heterosexual spouses of veterans qualify for bereavement counseling, death pensions, home loan guarantees and even a burial flag. They can also be buried beside a spouse in a veterans cemetery. That still isn't so for same-sex spouses.

How does the California case that's also before the court come into play?
If the court finds DOMA unconstitutional, the federal government can no longer deny benefits to gay and lesbian married couples. But who's allowed to get married has, for the most part, been left up to each state to decide. That's why the court's ruling in the California case is so important.

What rulings could the justices make in the California case?
The justices have several options. Here are a few:

• Californians didn't violate the U.S. Constitution when they chose to prohibit same-sex couples from marrying.
• Californians violated the Constitution, but for reasons that only apply to that state.
• No state can prevent same-sex marriages.

Don't some states already allow same-sex marriages?
Yes. Same-sex marriage is now legal in Connecticut, Iowa, Maine, Maryland, Massachusetts, New Hampshire, New York, Vermont and Washington, plus the District of Columbia. It becomes legal in Delaware July 1, and Rhode Island and Minnesota Aug. 1. The laws in these places won't be affected by the court's ruling in the California case.

Also of Interest

• Supreme Court Victories for Same-Sex Marriage
• What's the 'Medicaid expansion'?
• Will your retirement savings come up short?
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