Editor’s note: This is a transcript of the audio file.
Some states allow same sex couples to be married but the federal government does not. As a result the federal tax code does not recognize same-sex marriage which makes navigating tax issues tricky.
I’m Sheyna Steiner with the Bankrate.com personal finance minute.
A federal law called the defense of marriage act requires the IRS to treat legally married homosexual couples as strangers. As a result, filing joint tax returns is against the law.
No matter how your home state views your relationship you must file as single or head of household if you have a dependent.
Same sex couples are similarly disadvantaged when it comes to sharing assets.
For married heterosexual couples, there is no limit to the amount of money that can be gifted within the couple. But if you give your same-sex spouse more than a certain amount in your lifetime you can be subject to the federal gift tax. Individuals can gift up to $5 million in their lifetime without paying the gift tax but it was only recently increased from $1 million.
For more on this and other personal finance issues visit Bankrate.com I’m Sheyna Steiner.