Why there can be no compromise

Big Assets: What married same-sex couples don’t get in federal benefits
Steve Doster, CFP® - Certified Financial Planner™ professional


With Pride season in full swing and the recent victory for same-sex marriage in New York, it’s a good time to remember that legally married gay and lesbian couples still do not get over 1,100 federal benefits and protections that opposite-sex married couples receive.

This number gets published quite a bit, but rarely do we hear specifically what these 1,100 federal benefits are. I thought it would be a good idea to outline just two benefits that opposite-sex couples receive that same-sex spouses do not get.

One of the most important benefits denied to married same-sex couples deals with Social Security. For opposite-sex spouses, one spouse can receive 50% of their spouse’s Social Security check.

Let’s say a husband gets $2,000 per month in Social Security. His wife was a homemaker and she would only get $200 per month based on her short career prior to getting married. However, she will receive $1,000 per month in Social Security because she gets 50% of her husband’s benefit.

If the husband dies before the wife, then the wife will start receiving her husband’s $2,000 monthly Social Security check instead of her $1,000 benefit.

For same-sex spouse’s, they don’t receive 50% of their spouse’s Social Security benefit. If one partner stops working to take care of the kids, elderly parents and/or home, then that spouse will get a very small Social Security benefit based on their own short working history.

And when one spouse dies, the surviving spouse does not get to take over their higher-earning spouse’s Social Security benefit.

A second benefit same-sex spouses do not get deals with how retirement accounts of a deceased spouse are passed to the surviving spouse. The surviving spouse can rollover their deceased spouse’s retirement accounts into an inherited IRA, so long as they are listed as the primary beneficiary. However, they have to begin taking distributions the year after their partner dies creating taxable income.

The surviving spouse of an opposite-sex couple can rollover 401(k)’s and IRA’s of their deceased spouse into their own name. This allows the surviving spouse to avoid paying taxes until they have to begin taking Required Minimum Distributions at age 70½.

Those are just two of the 1,100 federal benefits married same-sex couples do not get. I could go on writing about things like filing separate federal tax returns, no unlimited marital estate tax exemption, taxation of partner health benefits, and lack of survivor benefits for federal and military pensions, but I think you get the point.

Gay and lesbian married couples can lose tens of thousands of dollars over a lifetime by being denied these federal benefits given to opposite-sex couples.

The one benefit we do get is the ability to fight for our equal rights by repealing the Defense of Marriage Act and legalizing gay marriage in California. So enjoy Pride and then let’s get back to work!