Same-Sex Marriage

Same-sex marriage is now legal nationwide. When the Civil Marriage Protection Act took effect January 1, 3013, same-sex couples gained the right to marry in Maryland and enjoy full state benefits. Some six months later, in United States v. Windsor, the U.S. Supreme Court overturned part of the Defense of Marriage Act and the federal government immediately began to recognize same-sex marriages.

Most recently, the Supreme Court ruled in Obergefell v. Hodges that the U.S. Constitution requires every state in the country to allow same-sex couples to marry. These historic victories provide many new legal rights.

These include the right to file joint state and federal tax returns, to receive Social Security and other spousal benefits, to obtain health insurance from a spouse’s employer, and to be prevented from testifying against each other in court. In addition, same-sex couples who choose to marry are entitled to most of the same rights as their opposite-sex counterparts in the realms of family medical leave, military and veterans' benefits, Medicare, immigration, and bankruptcy.

Marriage also provides important tax benefits. For example, married couples generally avoid the Maryland inheritance tax. This 10% tax applies to assets left to anyone who is not a spouse or other close family member.

Married couples can avoid other “death taxes” as well, or at least delay paying them until the second spouse dies. In Maryland, a tax of up to 16 percent applies to any portion of an estate that exceeds $4 million in value (this exempt amount will increase annually until it equals the federal exemption amount in 2019). The estate tax is less of a concern at the federal level, where only the portion of an estate that exceeds $5.6 million in value is taxed, but at the much higher rate of 40 percent. (Note that the value of an estate includes any life insurance or retirement accounts owned by the decedent.)

When one spouse dies, any bequest to the surviving spouse is generally tax-free. But estate taxes may be due on the second death if the surviving spouse’s estate exceeds either the state or federal exemption amount. To minimize this tax liability, an experienced estate-planning attorney can prepare wills that include provisions for a “bypass trust”—an effective estate-planning tool reserved to married couples.