When you deny same-sex couples the right to marry, you deny them the most commonly employed tax shelter: marriage. Without access to marriage tax benefits, same-sex couples pay far higher âÄúgay taxesâÄù than their straight counterparts.
In most instances, a married couple filing jointly owes less in income taxes than if the two people had filed separately with the same income. But same-sex couples must also pay âÄúgay taxesâÄù on any insurance benefits received from a domestic partner.
Small businesses pay âÄúgay taxesâÄù too. The vast majority of small businesses in the U.S. are family businesses and do not hire employees. They often take advantage of the payroll exemption for family members âÄî most commonly, the spouses of the business owner. A business owner who employs his or her same-sex partner must treat him or her as a non-family member employee, paying all the related employment taxes that a married couple easily avoids.
Furthermore, spouses can pass assets between each other tax-free; unmarried couples cannot. This means âÄúgay taxesâÄù must be paid every time a person in a same-sex relationship gives a car to their partner, adds their partner to their home title or financially supports their partner without charging a fair market interest rate.
Everything passed to a spouse when one dies is passed tax-free. No estate taxes are assessed. This trick allows married couples to transfer twice the amount of property to their children before being assessed estate taxes than an unmarried gay couple.
Therefore, children of a same-sex couple pay $2.63 million in federal âÄúgay taxesâÄù before the children of a married couple pay a single cent. Those children will pay an additional $410,000 in Minnesota âÄúgay taxes.âÄù $3 million is the âÄúgay tax penaltyâÄù for dying rich and gay.
Banning gay marriage forces same-sex couples to pay myriad âÄúgay taxes.âÄù So to all the political conservatives out there, I have an honest question: What is more important, banning gay marriage or lowering taxes? You canâÄôt have both.
