You may have heard reference to the Defense of Marriage Act (DOMA) in the news lately. In this post, we will briefly explain DOMA, recent Presidential and Congressional reaction, and the potential effects moving forward.
The Current Law
DOMA is essentially based on three provisions in Federal law:
1. The “Full Faith and Credit Clause” – Article IV, Section 1 of the U.S. Constitution — This states that “Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State. And the Congress may by general Laws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof.”
Translation: Unless Congress states otherwise, all states must accept the law, records and rulings of every other state.
2. Defense of Marriage Act, Section 3 – “Definition of Marriage and Spouse” – 1 U.S.C. § 7 — In determining the meaning of any Act of Congress, or of any ruling, regulation, or interpretation of the various administrative bureaus and agencies of the United States, the word “marriage” means only a legal union between one man and one woman as husband and wife, and the word “spouse” refers only to a person of the opposite sex who is a husband or a wife.
Translation: Congress has defined marriage as only between one man and one woman.
3. Defense of Marriage Act, Section 2 – “Powers Reserved to the States” – 28 U.S.C. § 1738C — This says that no U.S. State, territory, or possession, or Indian tribe, is required to give effect to any action by another State, territory, possession, or tribe respecting a relationship between persons of the same sex that is treated as a marriage under the laws of such other State, territory, possession, or tribe, or a right or claim arising from such relationship.
Translation: Congress has “stated otherwise” (see Translation from #1 above) – the Full Faith and Credit Clause does not apply to “marriage”, so no state has to accept another state’s approval of a marriage between those of the same sex.
DOMA passed in both houses of Congress, and President Bill Clinton signed it into law in 1996.
Two Federal Lawsuits Challenging DOMA
In November 2010, two federal lawsuits were filed in the Second Circuit:
- Windsor v. United States – Edith Windsor and Thea Spyer got married in Toronto in 2007. Their home state, New York, recognizes same-sex marriages performed in other jurisdictions. Ms. Spyer passed away in 2009, leaving everything to Ms. Windsor. Under the federal “marital deduction”, one spouse can leave all assets to another spouse without any estate taxes owed. However, based on DOMA, the federal government did not recognize the marriage and thereby charged $350,000 in estate taxes. On behalf of Ms. Windsor, the ACLU sued.
- Pedersen v. Office of Personnel Management – Connecticut resident Joanne Pederson repeatedly tried to add her spouse Ann Meitzen to her federal health insurance plan, but has been continually rejected. The Gay and Lesbian Advocates and Defenders (GLAD) filed suit on behalf of Ms. Pedersen.
Several other cases remain on the dockets of other circuit courts as well.
Obama Adminstration and Congressional Response
In February, the Justice Department announced that President Obama had decided to no longer defend DOMA in federal court, including the Windsor and Pedersen cases. Attorney General Eric Holder stated that Obama had concluded that Section 3 (The Definition of Marriage and Spouse) was unconstitutional.
However, the U.S. Government remains a party in these cases so that Congress and the courts can rule on the law and its constitutionality. On Wednesday, Sen. Dianne Fienstein (D-CA) and Rep. Jerald Nadler (D-NY) introduced matching bills (S.598 and H.R. 1116) for “The Respect for Marriage Act”, which aims to repeal DOMA and allow the U.S. Government to provide benefits to both spouses in a same-sex marriage.
Interestingly, Section 3 is the main section under attack. If this section is overturned and Section 2 (Powers Reserved to the States) remains in place, then marriage would no longer be defined as between a man and a woman under federal law. Same-sex married couples would receive all federal benefits — Ms. Windsor would not owe estate tax, and Ms. Pedersen could add Ms. Meitzen to her federal health insurance plan. Same-sex couples would be able to upgrade their estate plans to utilize strategies previously reserved for male-female marriages, such as A-B Trust planning.
However, the states would still have the right to reject this change and maintain the man-woman definition.
Interestingly, if Section 3 is overturned, an interesting estate planning effect could occur in states that charge its own estate tax but do not allow any form of same-sex unions. In states such as Delaware, Hawaii, Minnesota, North Carolina, Ohio, Oregon and Tennessee, same-sex survivors would owe state estate tax while not owing federal estate tax.
In other words, such people would be deemed both a surviving spouse and not a surviving spouse under separate taxation schemes.
- DOMA, Same-Sex Marriage, and the Estate Tax (deathandtaxesblog.com)
- Same Sex Marriage, The Estate Tax & The [Possible] Death of DOMA (bonasera.org)
- Another Article on the Possible Demise of DOMA (bonasera.org)
- The Defense of Marriage Act, the Marital Deduction, and the Estate Tax (sofloridaestateplanning.com)