{"id":144860,"date":"2021-11-16T18:49:08","date_gmt":"2021-11-16T18:49:08","guid":{"rendered":"https:\/\/precoinnews.com\/?p=144860"},"modified":"2021-11-16T18:49:08","modified_gmt":"2021-11-16T18:49:08","slug":"same-sex-couples-may-get-a-tax-break-from-democrats-1-75-trillion-social-plan","status":"publish","type":"post","link":"https:\/\/precoinnews.com\/business\/same-sex-couples-may-get-a-tax-break-from-democrats-1-75-trillion-social-plan\/","title":{"rendered":"Same-sex couples may get a tax break from Democrats\u2019 $1.75 trillion social plan"},"content":{"rendered":"<ul>\n<li>The Build Back Better Act would let same-sex couples file an amended tax return for years they were legally married before 2010. For some, that might be as early as 2004. <\/li>\n<li>IRS guidance after a Supreme Court ruling in United States v. Windsor only allowed for such amended returns back to 2010.<\/li>\n<li>Not all couples would necessarily get a tax benefit from filing new returns due largely to the marriage penalty. <\/li>\n<\/ul>\n<p>Same-sex married couples may get a tax break from Democrats&#x27; $1.75 trillion social and climate spending plan.<\/p>\n<p>The latest iteration of the Build Back Better Act would let taxpayers who were legally married under state law before 2010 claim federal tax benefits that are unavailable under current rules.<\/p>\n<p>Essentially, the revision would let couples file amended tax returns for years as early as 2004. They could file a joint federal return as a married couple, and claim refunds and credits that may result in a net tax benefit. \u00a0<\/p>\n<p><strong>More from Personal Finance:<\/strong><br \/>Why your Social Security COLA may not go as far next year<br \/>Here&#x27;s how rising inflation may lead to higher tax bills<br \/>Ending a marriage? Don&#x27;t get divorced from financial reality<\/p>\n<p>&quot;It&#x27;d be pretty significant for some folks,&quot; said Jeffrey Levine, an accountant and certified financial planner at Buckingham Wealth Partners in Long Island, New York.<\/p>\n<p>Democrats&#x27; legislation, which the House aims to pass this week, may change and its ultimate success isn&#x27;t guaranteed.<\/p>\n<h2>United States v. Windsor<\/h2>\n<p>The current gap in tax rules for some same-sex married couples dates to a Supreme Court decision in 2013, United States v. Windsor, which struck down part of the Defense of Marriage Act.<\/p>\n<p>The ruling required the federal government to recognize same-sex marriages in states where they were legal.<\/p>\n<p>Following the Windsor case, the IRS issued guidance that let taxpayers amend their tax returns with respect to their marital status, but only generally back to 2010, according to a Nov. 3 summary of the Build Back Better Act.<\/p>\n<p>However, same-sex marriage was legal in five states (Connecticut, Iowa, Massachusetts, New Hampshire and Vermont) plus Washington, D.C., before 2010, according to the Pew Research Center.<\/p>\n<p>(Massachusetts became the first state to legalize the unions, in 2003, after its Supreme Judicial Court ruled that the state constitution gives gay and lesbian couples the right to marry, according to Pew; weddings began in 2004. The U.S. Supreme Court later legalized same-sex marriage nationwide, in 2015, in Obergefell v. Hodges.)<\/p>\n<p>Gay and lesbian couples who legally wed before 2010 would be able to file an amended tax return if Congress passes the Build Back Better Act with the provision intact.<\/p>\n<p>&quot;This is a fair thing to do,&quot; said Steve Wamhoff, director of federal tax policy at the Institute on Taxation and Economic Policy. &quot;People were married [but] the federal government wasn&#x27;t recognizing their marriages.&quot;<\/p>\n<p>While fair in terms of tax policy, it&#x27;s questionable whether many couples would make the effort to redo their tax returns and take advantage of new rules, Wamhoff said.<\/p>\n<h2>Marriage penalty<\/h2>\n<p>It&#x27;s also not a given that all married couples would benefit from filing a joint return instead of as single taxpayers.<\/p>\n<p>Same-sex couples who&#x27;d benefit most from new rules would likely be those in which one spouse is a high earner and the other has little to no income, Levine said.<\/p>\n<p>That&#x27;s largely due to the so-called marriage penalty, which is most common when each spouse earns a similar income.<\/p>\n<p>For example, in 2004, single taxpayers were in the 28% tax bracket if their income exceeded $70,350. However, instead of a level twice that amount, married couples filing a joint tax return hit the 28% rate once income exceeded $117,250.<\/p>\n<p>That basically meant married couples jumped into that tax rate more easily with respect to their income. (There&#x27;s still a marriage penalty, but a federal tax law in 2017 temporarily eased it.)<\/p>\n<p>Married couples may also be able to claim certain tax benefits unavailable to single filers, Levine said.<\/p>\n<p>For example, if a higher-earning spouse had paid for medical or education expenses for the other spouse pre-2010, the high earner couldn&#x27;t claim medical or education tax breaks for those costs on their individual return, Levine said. They&#x27;d perhaps be able to do so on a married-joint return.<\/p>\n<p>Source: <a href=\"https:\/\/www.cnbc.com\/2021\/11\/16\/same-sex-couples-may-get-tax-break-from-democrat-build-back-better-plan.html\" target=\"_blank\" rel=\"noopener\">Read Full Article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Build Back Better Act would let<\/p>\n","protected":false},"author":3,"featured_media":144859,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23051],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.7 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Same-sex couples may get a tax break from Democrats\u2019 $1.75 trillion social plan - Pre Coin News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/precoinnews.com\/business\/same-sex-couples-may-get-a-tax-break-from-democrats-1-75-trillion-social-plan\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Same-sex couples may get a tax break from Democrats\u2019 $1.75 trillion social plan - 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