State Taxes for Married Same-Sex Couples
(Posted on November 25, 2014 by )


The chart, State Taxes and Married Same-Sex Couples, has been updated to reflect the fact 35 states plus the District of Columbia now allow same-sex marriage. One state (Missouri) recognizes same-sex marriages from other states. Missouri state and federal courts have both now ruled that it must allow such marriages in the state, and some jurisdictions in Missouri are allowing same-sex couples to get married there.

The pace of change became much more rapid after the Supreme Court denied certiorari in (refused to consider) any of the Circuit Court decisions striking down bans on same-sex marriage on October 6, and the Ninth Circuit struck down bans in Nevada and Idaho on October 7. On November 6, the Sixth Circuit upheld bans on same-sex marriage from four states, creating a conflict among the Circuits that is expected to result in the Supreme Court giving the issue a full review.

Taxing authorities in all of the states that continue to have bans on same-sex marriage have announced their interpretation of the filing status that married same-sex couples must use for state income tax purposes. Moreover, there is now at least one challenge to the same-sex marriage ban in every state that has such a ban, and almost all of the decisions that have so far been issued have struck down the bans. Read more.

2015 IRS Benefits & Contributions Limits Announced
(Posted on October 23, 2014 by )


On October 23, 2013, the IRS issued News Release IR-2014-99, announcing the changes in pensions and benefits limits for 2015. An updated chart, showing these limits for 1996 to 2015, is available by clicking here.

2015 Supplement to the Governmental Plans Answer Book Published
(Posted on September 23, 2014 by )


The 2015 Supplement to the Third Edition of the Governmental Plans Answer Book has now been published. Unlike previous editions, the Third Edition has been issued in loose-leaf form, so that supplements can be incorporated into the main volume, rather than requiring the reader to flip back and forth between a main volume and a supplement. It also incorporates new developments since 2012, when the most recent supplement to the Second Edition was published.

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2015 Supplement to the 457 Answer Book Published
(Posted on August 8, 2014 by )


The 2015 Supplement to the Sixth Edition of the 457 Answer Book was published on August 8, 2014. Carol V. Calhoun is the author of Chapter 1, History of 457 Plans, and Chapter 14, Miscellaneous Issues.

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NPR Interview, “State Tax Laws ‘A Mess,’ For Same Sex-Couples and Employers.”
(Posted on March 19, 2014 by )


Carol V. Calhoun was interviewed for a piece on National Public Radio’s “Here and Now” program called, “State Tax Laws ‘A Mess,’ For Same Sex-Couples and Employers,” which aired today. You can listen to the segment at this link, a summary and transcript can be found here, and the chart referenced in the story is available at this link..

New article: State Taxes and Married Same-Sex Couples
(Posted on March 7, 2014 by )


Carol V. Calhoun‘s article, “State Taxes and Married Same-Sex Couples,” has now been published in Baltimore OUTloud. This article discusses the different approaches that each of the states has taken for state tax purposes, in the wake of the federal government’s decision to treat same-sex married couples are married for federal tax purposes.

Cafeteria Plans Need to Move Fast to Take Advantage of Year-End IRS Guidance
(Posted on December 16, 2013 by )


On June 26, 2013, the Supreme Court issued the Windsor decision, striking down a provision in the federal Defense of Marriage Act which had precluded recognition of same-sex marriages. In September, the Internal Revenue Service (“IRS”) announced that same-sex couples legally married in a state that recognized such marriages would now be treated as married for purposes of federal taxation, regardless of whether their marriages were recognized by their state of residence. The IRS announcement was made retroactive, meaning that such marriages will be recognized back to their inception.

The IRS has issued Notice 2014-1, which provides guidance on the application of the new rules to cafeteria plans. However, in many instances employers will need to move quickly to take advantage of relief granted.

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Judge in Detroit Bankruptcy Case Denies Any Special Protections for Pensions
(Posted on December 5, 2013 by )


Judge Steven W. Rhodes of the U.S. Bankruptcy Court for the Eastern District of Michigan had now issued an opinion stating that the bankruptcy proceedings for the City of Detroit can go forward. The opinion provided no special protections for as yet unfunded pension benefits (although benefits already in the pension funds were protected). The judge rejected a contention that Michigan constitutional provisions prohibiting impairment of pensions would provide protection to promised but unfunded benefits.

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“No . . . law impairing the obligation of contract shall be enacted.” [Article I, Section 10, Michigan Constitution]

“The accrued financial benefits of each pension plan and retirement system of the state and its political subdivisions shall be a contractual obligation thereof which shall not be diminished or impaired thereby.” [Article IX, Section 24, Michigan Constitution]

Businesses Denied State Income Tax Deductions for Fringe Benefits for Same-Sex Spouses
(Posted on December 4, 2013 by )


The below article has now been rendered obsolete by Bostic v. Schaefer (4th Cir. 2014), cert. denied (2014), which struck down the ban on same-sex marriage in Virginia.

As discussed in the chart, “State Taxes and Married Same-Sex Couples,” most states that do not recognize same-sex marriage are requiring same-sex married couples to file their tax returns as single (or head of household, if they qualify for that status). However, Virginia has now gone further, denying certain Virginia businesses state income tax deductions for fringe benefits they provide to same-sex spouses. As discussed below, the language used is muddy, and the holding is probably considerably less broad than it appears. However, businesses in Virginia need to be aware of its potential effect on them. And to the extent that other states take the same route, businesses in states other than Virginia would also be affected.

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If You Like Your Insurance, You Can Keep Your Insurance… At Least For Another Year
(Posted on November 14, 2013 by )


In the wake of negative publicity about individuals and small businesses losing their existing health insurance due to the Affordable Care Act, the Department of Health & Human Services, in consultation with the Treasury Department and the Department of Labor, has provided transitional relief. The transitional relief applies only if certain conditions are met, as follows:

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