The Problem with Gay Marriage: It’s Way Too Taxing (For Some)
Many of my friends celebrated the great leap forward in our nation’s legal landscape by tying the knot last summer. #Lovewins was the hashtag and it’s a shorthand I love. But in the fine tradition of shorthands, #lovewins is entirely too cryptic to illuminate what it really means for gay couples to be legally wed.
When it comes to paying income taxes, marriage is most beneficial for couples with disparate incomes. The marriage bonuses can be up to 20%. One of the not so subtle biases against same gender couples – who more often have similar income levels – is that the tax penalties often exceed 10%.
Yes, taxes can be complicated, and increasingly costly, for some new couples. A few months ago I started to hear rumblings that are now becoming…divorce filings. Why? The tax implications have become a burden. The impact of that penalty can be hazardous to the health of non-profits that benefit, or even depend-on major, LGBTQ philanthropy.
At least one couple I know has decided to split for this reason: they can give significantly more as individuals, and want to do that more than they want to be legally married.
I get it. The emotional impact of a legal and recognized union matters much. But it can be a real trade-off, if marriage means your ability to give generously is inhibited.
#Lovewins becomes a conundrum for some of these otherwise happy couples.
In this season of celebrating the first anniversary of the historic Supreme Court ruling to recognize gay marriage, I also respect those who are wrestling with whether it’s worth it to stay married. The venerable institution of marriage has become hipper, I now think it is time for the U.S. tax code to catch-up.