Estate Planning Implications for U.S. v. Windsor and the Fall of DOMA

For years, same-sex couples trying to plan for their loved ones have faced a plethora of discriminatory tax and estate laws, resulting in everything from higher estate taxes to an inability to make medical decisions for an incapacitated partner. Some of those discrepancies were capable of being remedied through legal planning, while others simply had to be endured.

Discriminatory laws have been imposed at both the state and federal levels. At the federal level, the Defense of Marriage Act (DOMA), enacted in 1996, barred same-sex spouses from any marital benefits provided by the federal government, including certain gift and estate tax exemptions, social security, and spousal benefits for federal employees. DOMA further provided that states could refuse to recognize marriages between same-sex couples that were performed in other states.

On June 26, 2013, the U.S. Supreme Court declared the section of DOMA withholding federal benefits from same-sex couples unconstitutional in the case United States v. Windsor. The Court did not address the provisions of the act allowing states to refuse recognition of same-sex marriages performed out of state.

As a result of the Windsor decision, a same-sex couple that gets married and resides in a state recognizing same-sex marriage will now be entitled to all the federal benefits extended to other married couples. While the Windsor case represents a clear victory for equality, questions remain about its full implications, including:

  1. Whether the marriage of couples who have wed in one state will be entitled to the same marriage benefits under federal law if they move to a state that does not recognize same-sex marriage and
  2. Whether the Windsor case establishes a federal right to same-sex marriage that extends to couples in all states.

These questions will likely go unanswered for some time until additional cases are resolved by the courts. In the meantime, same-sex couples should consult with their estate planning attorney to see how the ruling will affect their particular situation and determine whether changes need to be made to their estate plan.

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