SUPREME COURT STRIKES DOWN THE DEFENSE OF MARRIAGE ACT
Today was a big day for same-sex marriage. The Supreme Court issued its decision in a case called United States v. Windsor, which challenged the constitutionality of Section 3 of the Defense of Marriage Act (“DOMA”). In Windsor, the Court found Section 3 of DOMA to be unconstitutional, as a violation of the Equal Protection Clause, because it treated same-sex marriages differently than opposite-sex marriages, without a good reason for doing so.
A little history on DOMA. Each state has the power to regulate marriage (and divorce) within its territory. Thus, the laws applying to marriage and divorce are different from state to state. In the 1990’s, there was concern among those states opposed to same-sex marriage that they would be forced to recognize same-sex marriages performed and legalized in another state in the future. In response to this concern, DOMA was passed by a bi-partisan Congress and signed into law by President Clinton.
Section 2 of DOMA, which wasn’t challenged in the Windsor case, allowed those states that did not recognize same-sex marriage to refuse to recognize valid same-sex marriages solemnized in another state.
Section 3 of DOMA went further. It defined the words “marriage” and “spouse” for purposes of federal law as applying only to opposite-sex marriages. While DOMA did not prohibit same-sex marriage per se, it struck it a devastating blow and had a huge impact on married same-sex couples.
Think of all the benefits that accrue to a married couple under federal law. You can file taxes together. You’re entitled to Social Security payments through your spouse after 10 years of marriage (even if you’re then divorced). You can petition for a non-U.S. citizen spouse to regularize their immigration status in this country. When one spouse dies, an estate tax exemption for surviving spouses protects a surviving spouse from having to pay estate taxes. The list goes on.
In divorce, as well, there are benefits to being married under federal law. Any transfer of property between spouses, a common occurrence when divorcing spouses are dividing their marital property, is exempted from federal taxes. In the realm of retirement assets, another common area of division in divorce, transfer of all or part of a qualified retirement plan between spouses can be made through a “Qualified Domestic Relations Order.” Spousal maintenance payments, common where there is a differential in earning power between the spouses, are tax-deductible by the payor and taxable to the payee. This preferential tax treatment often results in a tax savings, and more available income, for the divorcing spouses.
DOMA made all of the above unavailable to same-sex married couples, solely on the basis of sexual orientation. Today, the Supreme Court said that the discrimination in Section 3 of DOMA was unconstitutional, and as a result, that part of DOMA was struck down, a victory for same-sex couples. For same-sex couples going through or preparing for a divorce in this post-Windsor landscape, the impact of Windsor should be thoroughly assessed as part of any discussion about property division (of retirement and non-retirement assets) or spousal maintenance.
For detailed coverage of today’s decision(s), click here.
For a picture of Edith Windsor and her attorney Roberta Kaplan learning of their victory, clickhere.