The IRS Takes a Bite Out of DOMA, Pt 3
Before beginning today’s article in earnest, a brief recognition and review of the legislative process is relevant. Yesterday, Tuesday, November 5, 2013, was a historic day for Illinois. The state’s legislature voted affirmatively on the question of marriage equality, i.e., allowing Illinois same-sex couples to marry. Thus, Illinois LGBT couples, as of June 1, 2014, may enter into a legal state of loving matrimony. Listening to members on the floor of the House deliver the reasons why they favored the bill, SB10, one theme rang loud and clear: We should not be a society where the law treats individuals or groups in our population differently because other individuals or groups disagree with their lifestyles, don’t like them, or may not understand what makes them “different.” Sidebar: I’m saving arguments that address the reductio ad absurdum issue for later. Being one of those “different” kinda folks myself, I have always been a proponent of marriage equality and LGBT equal rights. Yet, when I saw and heard Catholics and African American men steadfastly and eloquently place their support behind the law, a sense of pride in our legislature, in our democratic system of governance, in our state, washed over me. While Illinois, most assuredly, has its fiscal woes, our money problems aren’t, or at least shouldn’t be, the ultimate issue. The ultimate issue is whether those of us with immutable differences, such as sexual orientation and identification, skin color, or ethnicity, should be afforded the same rights as those whose immutable characteristics are more commonplace. Surely, if we look deep enough, we will recognize that, in some way, we are all different, and our differences should not be the sole basis for refusing, abrogating, eliminating, or enlarging our rights individually and collectively. The fundamental rights of all should be equal. Therefore, if a state gives the right to marry or literally speaking, license to marry, to one group, it is an abomination to our system of democracy if we do not provide the same license to another. So it stands that Illinois citizens should applaud our legislators who lifted the rights of all Illinoisans yesterday when they provided marriage equality to our LGBT community. Now back to the business at hand, which is even more poignant for Illinois couples given the last 24 hours. Because of Windsor and the flurry of guidance that followed, disparate treatment of lawfully married same-sex couples under federal tax laws has been virtually eliminated. Therefore, estate and tax planning for same-sex married couples is more aligned with traditional estate planning methods for opposite-sex married couples. In the post Illinois Civil Union – make that the Illinois Religious Freedom and Marriage Fairness – Act and post Windsor plus guidance world, a same-sex married couple in Illinois should receive equal federal and Illinois treatment for purposes of income tax, estate tax, qualified retirement plans under ERISA, and FICA. However, practitioners must be mindful of the nuances between Illinois and federal law, such as, statute of limitations for amending returns, date of marriage recognition, portability*, and the fact that Illinois estate tax exemption is lower than the federal exemption. *Portability is the “check the box rule” that allows a surviving spouse to use the unused portion of the deceased spouse’s lifetime gift exemption. EXAMPLE: Michael dies on June 30, 2014 and used $1M of his $5.34M federal exemption. David, Michael’s surviving spouse can add the remaining $4.34M of Michael’s exemption. This means if David hasn’t used his, he now has $9.68M to give away tax free during his lifetime. NOTE: Before the Rev. Rule 2013-17, this wasn’t available to lawfully married same-sex couples anywhere in the U.S. So what does this mean for filing purposes? Because lawfully married same-sex couples are now equal in the eyes of the state and federal tax regimes for Illinois, they don’t have to complete “dummy” federal returns for income or estate tax purposes. WARNING: Illinois couples who are currently only in Civil Unions are not in federally recognized relationship; so, they must still complete the “dummy” forms. IRS Notice 2013-61 followed Rev. Rule 2013-17 and is at the center of the tax return amending issue for most married same-sex couples. The Notice requires employers to amend their 941 returns with respect to over withholding, FICA overpayment, and benefits counted as wages. Why is this relevant to estate tax returns? To file an accurate estate tax return, Form 706, an accountant or attorney should have an accurate income tax return record. Therefore, for these purposes especially, before amending a 706, a decedent spouse’s 1040 should probably be amended to account for Notice 2013-61 issues. Debates wage among colleagues about whether to file an amended return for an estate that is not taxable and, given the level of the federal exemption for a married couple, only very few estates are taxable at the federal level and even at Illinois’ level. Yet, if the income tax return is being amended, then filing a 706 might be advisable for consistency’s sake. Also, a surviving spouse should file a 706 if he or she wants to or should elect portability. All of this ultimately suggests that surviving spouses of same-sex marriages should request a filing extension on original returns to ensure that all tax records are thoroughly reviewed before filing amendments. The same premises apply for Illinois estate taxes because federal numbers drive state numbers. Of course, just because tax returns that fall within the statute of limitations should be reviewed, doesn’t mean they should be amended. Like a surviving spouse of an opposite sex marriage, a surviving spouse of a same-sex marriage might have to pay more taxes. Nevertheless, couples should review the amendment issue. As discussed last week, Rev Rule 2013-17 stipulates that “affected taxpayers may rely on this revenue ruling for the purpose of filing original returns, amended returns, adjusted returns or claims for credit or refund for any overpayment of tax resulting from these holdings providing the applicable limitations period for filing such claim
Illinois Legislature Passed Marriage Equality Bill
Illinois shall become the 15th state to recognize same-sex marriage. When Governor Patrick Quinn signs the bill, LGBT couples may become lawfully married on June 1, 2014. See the live vote and Illinois Representative Greg Harris\’ remark, here.
The IRS Takes a Bite Out of DOMA, Pt 2
As mentioned in the first article of this series, the U.S. Supreme Court’s (aka SCOTUS) Windsor decision resulted in a flurry of guidance from several government agencies. The agency leading the charge, because its treatment of estate taxes was called to the carpet in Windsor, was the IRS. Sidebar: When SCOTUS or an agency, such as the IRS, decides on an overall course of action, the action typically can’t or, better yet – shouldn’t, occur until the agency provides a legal how-to analysis and procedural guidelines (aka “guidance”) for those who depend on the agency when performing their respective jobs. In this case, it would be estate planners, CPAs, and others. The IRS responded to Windsor faster than most of us have ever seen with respect to an issue of discriminatory treatment of individuals; it’s response was Revenue Ruling (Rev. Rule) 2013-17. WARNING: Despite my best efforts the following language will likely be a little dry. Rev. Rule 2013-17 painstakingly crafted an IRS rule based on (1) gender neutrality, (2) the IRS’s historical treatment of common law marriage, and (3) the burdens placed on both the taxpayer and the IRS by the so-called Defense of Marriage Act (DOMA). Though somewhat spliced between most sections of the analysis, the rule provides that in the eyes of the IRS, “husband,” “wife,” and “spouse” each mean a “married person” and that “marriage” is a lawful union between “married people.” Thus, the Rev. Rule completely removed gender from the analysis of tax treatment for married couples. The IRS reached this conclusion by examining the references to gender within the Internal Revenue Code (Code) itself and found few instances of express, gender-specific terms. Further examination of legislative history and recognition of statutory construction (how laws should be interpreted) supported the gender neutrality basis for the federal tax treatment of married same-sex couples. Next, to answer whether credence should be given to state law if the state didn’t recognize the marriage as valid (recall, SCOTUS didn’t invalidate DOMA Section 2 which allows a state to not recognize valid same-sex marriages), the IRS considered its historical treatment of common law marriages. More than 50 years ago, the IRS decided that it would recognize common law marriages even if a state didn’t; therefore, it saw no reason to undo more than 50 years of precedent. (I will resist the strong temptation to comment on Citizens United here.) Equally important, the IRS determined that despite the lack of uniformity among the states regarding marriage and state taxes, “uniform nationwide rules are essential for efficient and fair tax administration.” Considering how inefficient DOMA Section 3 made tax administration, the IRS stated that “more than 200 Code provisions and Treasury regulations” contain terms pertaining to marriage. Additionally, more than 1,000 statutes and regulations are affected by DOMA, placing a huge burden on same-sex couples by forcing them to use a complicated tax return filing process. Finally, the IRS also recognized the increased healthcare costs to these families created by a loss of the tax benefits opposite-sex spouses enjoy though employer benefits. Also, looking at DOMA and its Section 3’s affect on tax administration, the IRS pointed to Windsor, where the reason for Section 3 was noted as anything but fair but, on the contrary, designed to “injure and disparage” same-sex couples seeking to marry. The Rev. Rule also acknowledged and agreed with SCOTUS\’s Fifth Amendment analysis inWindsor, stating that the IRS would prefer to pass rules and regulations that are more constitutionally valid than not. Accordingly, the IRS per Rev Rule 2013-17 affords legally married same-sex couples the same tax treatment with respect to the federal tax regime as married opposite-sex couples, even if the couple resides in a state that doesn’t recognize their marriage (an “unfriendly” state). The rule, however, also expressly provides that this treatment does not extend to those couples in a Civil Union, Registered Domestic Partnership, or other relationship that bears a substantial similarity in state law benefits to marriage but are not, in fact, marriages. IRS v. DOMA: IRS score BIG ONE; DOMA down 1 ½ . Tune in next week for what this means practically speaking for married LGBT couples. The IRS Bites DOMA, Pt 1 | 2 | 3 | 4
The IRS Takes a Bite Out of DOMA, Part 1
Recently, on a panel at a Chicago Bar Association’s Trust Committee meeting, I discussed tax and estate planning issues in light of the U.S. Supreme Court case, U.S. v. Windsor and the new federal agency rules on same-sex married couples. This article is Part 1 of a 4-part series from that discussion. Before Windsor, preparing estate plans for same-sex couples was often complex, especially if the couples were married, in a Civil Union, Registered Domestic Partners, or long-time partners in a substantially similar relationship when compared to opposite-sex married couples. The so-called Defense of Marriage Act (DOMA) compounded the complexity by prohibiting federal agencies from recognizing the couples and spurring states to create mini-DOMAs. The disparate treatment forced same-sex couples with sizable estates to literally give away large portions of their assets, either in the form of charitable donations or tax payments. However, even couples with very modest estates were required to have powers of attorney and related directives prepared with painstaking creativity. Finally, when most couples, despite their estate\’s size, asked why their planning was so complex, they listened to how their families were “different” and warnings, such as “though a valid legal document, don’t use this in Texas,” or “don’t have an accident in Will County.” Generally, creating a joint will for same-sex couples, even those lawfully married, was and still is a risky undertaking because the relationship was not federally recognized and is not recognized by a majority of states. Even in states such as Illinois where Civil Union couples have the same benefits of as opposite-sex married couples, including testamentary benefit, some counties are nonetheless hostile. Thus, a surviving partner presenting a joint will in a probate court of such a county might face an uphill battle. Setting the issue of joint wills aside, but considering will provisions, the unequal treatment of same-sex couples required careful tailoring of what could be boilerplate provisions in wills for opposite-sex married couples. The tailoring and special provisions include: Family Article; A statement of intent; Definitions providing expansive and inclusive meanings for “child,” “partner,” Civil Union, Registered Domestic partner, spouse, next of kin, and marriage; Prospective guardianship and successor guardianship language; A no-contest provision; A pour-over provision; A definitive choice of law statement; A notary seal, though notarizing a will is not required in Illinois; and more. I mentioned the pour-over provision because even if the family is of modest means, contentious behavior from another family member would warrant a trust also be prepared as a second line of defense for fighting contention. This is not the case for married opposite-sex couples because the opposite-sex surviving spouse would, at least initially, have the law squarely on his or her side as a second line of defense. If a same-sex couple of modest means could not afford a trust, and some could not, then they would try to plan for transferring all assets by operation of law and hope that a family member with a small estate affidavit didn’t show up to claim for the forgotten bank account. For the sake of example, let’s say a trust was prepared. One positive sliver for practitioners and our clients was that we didn’t have to worry about the reciprocal trust doctrine or unlimited marital deduction (IRC 2056) issues. But that was just the point: Because of the unfair treatment by the government, our clients could not take advantage of the unlimited marital deduction, federal QTIP elections, gift-splitting, or portability. So provisions had to be drafted carefully to work-around this lack of spousal gifting benefits. Additional provisions and mechanisms for trusts included: Expressly prohibiting a contentious family member from acting in a fiduciary capacity Providing the trustee and successor trustee with HIPAA rights; Providing the trustee with authority to take reasonable steps to ensure transfer of retirement assets to the same-sex spouse or partner result in the least adverse tax implications for the surviving spouse or partner; Using life insurance trusts; and Thoughtfully and diligently considering the “common disaster” provision. As mentioned earlier, other directives, agreements, and documents were and still are critical. These instruments include HIPAA release forms; a hospital visitation authorization form; reciprocal powers of attorney with 2 disinterested witnesses per instrument and with each instrument notarized but with a warning about describing the relationship depending on the county (imagine – having to hide your relationship in case of a medical emergency in order to ensure your spouse’s medical treatment!); reciprocal living wills; and reciprocal Illinois Mental Health Treatment Declarations. Many colleagues might say that possessing all of these documents would be redundant, and they would be correct…with respect to opposite-sex married couples. However, for same-sex married couples possessing all of these documents is evidence that strongly supports the commitment between the 2 individuals and, thus, their testamentary intent. Thankfully, Windsor and the subsequent flurry of guidance from government agencies took a bite out of DOMA; and stay tuned for Part 2 of this series, which will cover that guidance. One nation with justice and liberty for all… The IRS Bites DOMA, Pt 1 | 2 | 3 | 4
The IRS Recognizes Your Marriage Even if Your State Won\’t
Last week, in the wake of Windsor v. U.S., the IRS issued Revenue Ruling 2013-17. A Revenue Ruling, or “Rev. Rule,” is similar to a court opinion; it\’s just IRS law instead of case law. Thus, Rev. Rule 2013-17 mandated equal tax treatment for all lawfully married same-sex couples in ALL of the United States of America. As discussed here previously, in Windsor, the Supreme Court struck down Section 3 of the so-called Defense of Marriage Act (DOMA), which provided that the definition of marriage for purposes of rules, regulations, and laws promulgated through the federal government was the legal union of one man and one woman as husband and wife. The Windsor decision was a great step forward in ending discrimination against a segment of the U.S. population; however the decision was incomplete because it left standing DOMA\’s Section 2 that provides that states do not have to recognize same-sex marriages. As a result, Windsor v. U.S. left an even messier patchwork of laws for states and the federal government to wrestle with in regards to marriage equality. The question in Windsor was whether the IRS wrongfully denied issuing an estate tax refund requested by the surviving spouse of a married same-sex couple. The IRS lost in the lower court and SCOTUS affirmed that court\’s decision by striking Section 3. Having not prevailed, the IRS then had to determine how to comply with the Court Order. Had the IRS decided that tax return filings were to be based on domicile, then it would have been aligned with Section 2 of DOMA. Same-sex married couples residing in “unfriendly” states would have had to ignore the fact that they were legally married and file as “single.” So the IRS could still have chosen a less than friendly route for same-sex marrieds. However, recognizing the spirit of Windsor, Rev. Rule 2013-17 mandated equal treatment of married same-sex couples by basing the filing of returns on place of solemnization: \”For Federal tax purposes, the [IRS] adopts a general rule recognizing a marriage of same-sex individuals that was validly entered into in a state whose laws authorize the marriage of two individuals o the same sex even if the married couple is domiciled in a state that does not recognize the validity of that same-sex marriage.\” (Emphasis added.) What exactly does this mean overall? It means that lawfully married same-sex couples can live in unfriendly states and file taxes for the federal government using “married filing jointly” or “married filing separately.” Unfortunately, they still must abide by state tax return rules but at least they don’t have to move. What does this mean for same-sex couples in Illinois? If you were legally married elsewhere, e.g., Iowa, but reside in Illinois, you can file federal and state taxes using your legal relationship status and file “married filing jointly” or “married filing separately.” If you are in a Civil Union, you can\’t file your federal taxes as a married couple but you can file your state taxes as a married couple. Agreed: Illinois needs to get with the program and provide marriage equality. Summarily? While SCOTUS purportedly left the issue of validating same-sex marriage to the states, at least some federal agencies, such as the IRS, that actually must perform the work SCOTUS decisions create, recognize the \”United\” in U.S.A. and are willing to pass laws accordingly.
Unraveling the Windsor Knot Part II
In Part I, we covered the U.S. v. Windsor (Windsor) analysis on the first component of standing: Article III requirements. Standing is the term of art used to discuss whether (1) parties have a case or controversy that the courts can hear, i.e., “Article III standing,” and (2) even if the court can hear the case, after considering other factors, the issue becomes should it, i.e., “prudential standing.” Here, in Part II, we continue looking at the issue of standing, specifically, satisfying the prudential principle. HINT: If you don\’t want to fight through the necessary legalese, bullet points are at the end. Having found Article III standing requirements met, the majority in Windsor, continued to prudential considerations. The Opinion used prudential considerations to address the BLAG’s standing. Before discussing and explaining what prudential standing is, Justice Scalia’s reference in his dissent to the majority’s use of prudential considerations is worth noting. Scalia argued that that majority sees the Article III requirements of adverseness as “prudential.” Recognizing how the Court uses the term “adverseness” in the Opinion, one can understand Scalia’s observation that the majority conflates adversity within the meaning of controversy for Article III standing and the adverseness involved with prudential standing. The majority cites Allen v. Wright (Allen) to explain the principle of prudential standing and offers Warth v. Seldin (Warth) as an example of how the limitations considered in the prudential principle can be overcome. And it is with these 2 cases that we’ll continue untying the Windsor knot of standing. Allen is a 1984 case where African-American families challenged the IRS’ standards for tax-exempt status as those standards were applied to private schools that allegedly engaged in racial discrimination. The Court in Allen, stated that the prudential strand of standing called for “judicially self-imposed limits on the exercise of federal jurisdiction, such as (1) the general prohibition on a litigant\’s raising another person\’s legal rights, (2) the rule barring adjudication of generalized grievances more appropriately addressed in the representative branches (a little ditty known as the “political question doctrine”), and (3) the requirement that a plaintiff\’s complaint fall within the zone of interests protected by the law invoked.” So this means that even if Article III standing is found, an appellate court does not have to hear a case if it is limited by one or more of the 3 factors listed above, i.e, if the Court is limited by prudential considerations. Ultimately, the Court ruled that the plaintiffs in Allen lacked Article III standing. Since the plaintiffs lacked Article III standing, whether the plaintiffs had prudential standing was irrelevant. The Court also made clear that an individual’s mere assertion of a right to have the federal government act in a way that is lawful is not sufficient to have a case heard. Warth, decided in 1975 – before Allen, involved taxpayers, residents, and a non-profit organization of Rochester County, New York that opposed zoning laws preventing low and moderate income families from being able to live in Penfield, NY. Proponents of the zoning laws were Penfield’s town, its Zoning Board, and Penfield’s Planning Commission members. The Court in Warth, first elaborated on Article III standing requirements and found them unmet but still considered prudential limitations, stating that “countervailing considerations … may outweigh concerns underlying the usual reluctance to exert judicial power.” So while Article III standing is required and prudential limits can veto Article III standing, certain factors can also veto prudential standing. In the same analysis structure as Warth and Allen, the Court in Windsor first considered Article III requirements, which the Court found satisfied. Then the Court considered the prudential limitations and found that sufficient “countervailing considerations” outweighed prudential limitations. This, Justice Scalia found, “incomprehensible.” But Scalia failed to mention that if the Court’s discussion in Windsor is viewed en toto, the Court is undoubtedly considering the 2 components of standing as separate components: Article III standing as explained in Lujan v. Defenders of Wildlife and (2) prudential limitations as explained in Warth and Allen. In fact, the majority stated outright, “The Court has kept these 2 strands separate: “Article III standing, which enforces the Constitution’s case-or-controversy requirement [citation omitted]; and prudential standing, which embodies “judicially self-imposed limits on the exercise of federal jurisdiction.” However, using the terminology generally ascribed to one principal as a way to explain how the other principle is applicable is assuredly confusing. And Justice Scalia\’s comments, in typical Scalia form, magnify the confusion. Forgetting Scalia’s commentary, the explanation in Warth clarifies the Windsor Opinion’s take on prudential limitations. Warth explains that if a plaintiff’s claim affects the legal rights of third parties, then prudential limits that might generally apply may be set aside. In other words, protecting the legal rights of persons outside the immediate parties involved might be more important than denying relief to one, as long as Article III requirements were met. In Windsor, Edie’s “win” wasn’t really a win because the IRS still refused to refund her money. So there was Article III controversy. Equally important, DOMA, a congressional statute negatively affected the rights of hundreds of thousands of others. It was this negative effect, which the majority called “adverseness,” that met the Warth test for overweighing the prudential considerations to which the Windsor majority referred in its prudential principle discussion. Justice Scalia chided the majority for calling \”adverseness\” an element of standing, when, in fact, per Chadha v. INS (Chadha) and Baker v. Carr (Baker), the adverseness that the majority refers to is provided to support an argument for prudential standing. Furthermore, Scalia projects the majority’s use of prudential standing in Chadha onto the majority’s use in Windsor, when it is not the use of prudential sanding as it was used in Chadha but the underlying factors of prudential standing that the majority used in Windsor. Again, by stepping back a few paces and analyzing the majority’s discussion as a whole, Baker also illuminates the issue and provides foundation for the Warth explanation. Baker
Unraveling the Windsor Knot
Last week’s lengthy post examined from a broad perspective the United States v. Windsor case as a whole regarding what it did and did not do for same-sex marriage in the U.S. This week’s post is the first in a series of closer examinations on the specific issues and case law involved in this “landmark” Opinion. Though, the phrase “earth-shattering” may be more appropriate. In this first more narrow perspective, we’ll start with the Court’s question on whether it should have heard the case at all, particularly the issue of Article III jurisdiction. Article III of the U.S. Constitution mandates that courts can only hear “cases” or “controversies” and case law adds a few other requirements. So let’s consider how the question of Article III jurisdiction came into play and how it was resolved. Controversies may seem readily apparent simply because one party is on one side of the “v,” for “versus,” and another party is on the other side, e.g., United States Versus Windsor. Obviously, the U.S. and Windsor disagreed. But did they? Those who say no genuine controversy existed based their argument on the fact that the Department of Justice refused to defend DOMA’s Section 3 because the President considered Section 3 unconstitutional. Can the President do that? Yes, the President can and the United States Supreme Court agreed with the Constitutional scholar who is also the President of the United States of America: Section 3 of DOMA is unconstitutional. BUT, the sticky wicket in this case was that the Executive typically takes this type of position when the situation is adversarial, i.e., when a lower court disagrees. In Windsor, the lower court agreed. So just how was there was a “controversy”? Well, the Executive may have refused to defend Section 3, but it stated that it would continue to enforce it. A la, we have controversy…maybe… The Supreme Court used the case, Hein v. Freedom From Religion Foundation, as its starting point. In Hein, taxpayers sued the government for using money in faith-based programs initiated by former President Bush. The Court determined that the taxpayers lacked standing and thus couldn’t sue and reversed the appellate court’s ruling. A fundamental requirement for Article III controversies is standing, which is met when “a plaintiff [alleges] personal injury” that can be reasonably liked back to the defendant’s illegal action or actions and the relief sought by the plaintiff can probably be provided. Here, there was no doubt that Edie suffered injury – more than $360,000 worth – and the U.S. wasn’t going to enforce the IRS’s refusal to pay the refund based on DOMA’s Section 3. So, though the lower court may have ordered the IRS to pay, congressional law told the IRS not to refund the payment. The Court probably could have stopped here, because it could have remanded the case back down to the lower court with the admonition, with which Justice Scalia would have agreed, that Congress already spoke. But the Court ventured on, using INS v. Chadha to find controversy in the case past the issue of remand. In Chadha, a person who overstayed their visa was ordered by the INS (now known as USCIS) to leave the U.S. That person appealed to the Attorney General of the U.S., who granted the relief. However, Congress had the authority to veto the U.S. Attorney General and did so. So, like Windsor, Chadha was a case where the Executive sided with one plaintiff and another government body – this time the House – disagreed. The Court in Chadha ruled that a controversy existed despite the agreement because there was “concrete adverseness\” about the issue and there was adequate Article III standing before Congress vetoed. Now, let’s look at Windsor again. The lower appellate court and the plaintiff agreed in Windsor agreed. There was – and still is – an ugly, discriminatory congressional statute affecting “the entire U.S. Code.” So Congress had spoken. These facts are a tad different from Chadha… So where’s the controversy? Stay tuned… Unravelling the Windsor Knot: Part 1 | Part 2
The Supreme Court and DOMA\’s SoberRing
Last week we celebrated the Supreme Court of the United States (SCOTUS) striking down Section 3 of the so-called Defense of Marriage Act (DOMA). And let’s be clear, SCOTUS did not strike down DOMA; it indeed gutted the act, but strike it down completely it did not. The expanding and subtle rant about that is slightly further down, in this uncommonly lengthy article – consider yourself forewarned, but we need to be clear that DOMA is still congressional law. Now, we’ve all seen it on TV: The witness can only answer ‘yes’ or ‘no,’ and is asked a question where she must answer ‘yes,’ but the ‘yes’ is only because of mitigating facts that may or may not come to light. Well, I must admit that while I am assuredly a liberal Democrat who disagrees with most of Justice Scalia’s Opinions and remarks, I must say “yes, Your Honor\” to Scalia’s dissent regarding an “argle-bargle” opinion. United States v. Windsor was poorly written and the final holding was the mother of all judicial disclaimers. BUT this isn’t TV, so I get to share the mitigating facts behind my agreeing with the Justice who so often ruffles my feathers as I work through this Opinion\’s analysis. Fasten your seatbelt… Immediately in the introductory paragraph, we’re given a slight hint about the parameters of the decision when we’re told that Windsor is challenging DOMA’s provision that defines marriage. Next, in the Opinion’s Section I, we’re told flat out, DOMA’s Section 2 hasn’t been challenged here. Mitigating factor #1: Since the Court doesn’t go on to mention a sua sponte action, whereby the Court can on its own inclination consider the entire statute, we’re on notice. Only part of this despicable law is going to be decided by this Opinion. Sidebar: For those of you unfamiliar with Section 2 of DOMA and who haven’t read the Opinion, Section 2 provides that a state can refuse to recognize same-sex marriages legally performed in other states. The Court then explains that the definition provision in Section 3, which defines marriage as “only a legal union between one man and one woman as husband and wife” and confines the term “spouse” to a heterosexual marriage, doesn’t prohibit States from allowing same-sex marriages but it does put a sincere damper on the availability to LGBT married couples of the more than 1000 benefits provided to straight married couples. One of those benefits, upon which the case\’s issue was based, is the right to the spousal estate tax deduction. Yet, even before reaching the case\’s factual issue, the Court had to address whether this case was, in fact, a case. Long ago, it was determined that courts, including SCOTUS, should only hear cases that represented a controversy. Here, there was a question on whether a controversy existed because the Administration agreed with Windsor, the plaintiff. If the government agreed with the plaintiff filing suit against it, then where’s the controversy? In Section II of the Opinion, the Court agrees that a taxpayer’s grievance should be concrete, persistent, and redressable, and that Windsor’s loss of more than $360,000 fit the bill. We all did, even the U.S., so again, where’s the controversy? Who on the U.S. side will be hurt if the U.S. agrees Windsor was hurt? Well, after discussing the issue of regular Article III standing, where a party has to meet those 3 elements mentioned above for it to be a party to a controversy and the ethereal issue of “prudential standing,” the Court finally unveils the interesting idea. It deems that the U.S. Treasury will be harmed because were it not for the lower court’s 0rder to pay the refund, the U.S. Treasury would be $360,000 richer. In other words, though the U.S. agreed with Windsor on principle, because the order for it to pay up put the U.S. government in harm’s way, we have controversy. I’m scratching my head, but we got there… Many questioned the Bipartisan Legal Advisory Group’s (BLAG) right to stand in the controversy, too, but the Court stated that BLAG’s “sharp adversarial position” when considered with the guidance that would be missing from 94 districts across the country and the 1000 laws, rules, and regulations affected, the Court decided in its “prudential” wisdom that BLAG had standing. Several colleagues are still combing the lines of the Opinion’s Section II about that prudential standing stuff, but I prefer to move on to Section III, which is equally, if not more fascinating… In Section III, the Court unravels (?) its reasoning for striking Section 3 of DOMA while maintaining Section 2, the States’ power. Citing Sosna v. Iowa, the Court reasoned that in addition to the lack of discrimination espoused by the Court’s ruling in Loving v. Virginia, which make state definitions of marriage constitutional, states still have the authority to regulate marriage. Once more? A state\’s definition of marriage must adhere to non-discriminatory rules of the U.S. Constitution but the States can determine how that definition plays out. Fascinating. To further elucidate this point, the Court then cites In re Burrus for the rule that all domestic relations regarding a family fall within the legal purview of the States, not the federal government. When the government does something like define marriage, the federal courts generally defer to the States and choose not to hear domestic relations cases. So if a state’s regulation of a constitutional definition of marriage violates the constitution, the courts can look away? Remarkable. Understanding the confusion this section must have wrought, the Court then makes grand gestures: Citing Romer v. Evans, the Court provides that (1) when a law discriminates so blatantly, its constitutionality should be scrutinized; (2) unlike typical laws passed by the federal government to eliminate discrimination, DOMA does the opposite – it’s Fifth Amendment constitutionality must be questioned; and (3) states provide for same-sex marriage because marriage is much more than a myriad of legal rights and benefits – marriage confers a relationship status
Marriage Is Not a \”Cell Phone\”
Reading the New York Times commentary and analysis of the Supreme Court\’s hearing on the Prop 8 case involving California\’s same-sex marriage issue, what struck deeper than anything else was the seeming reluctance of the Court to do what it is appointed to do: protect the rights of those United States persons who have been discriminated against, marginalized, or otherwise made to suffer injustice. While an \”all-or-nothing\” choice can be frustrating and using the force of law to make a large minority accept a trend that improves the civil rights of thousands instead of ruling on a decision where a large majority has issue with whether the hunting of birds flying over a particular state violates an international treaty, U.S. Supreme Court justices are appointed for just that reason. It has always been my understanding that the Court, because it is the final arbiter of American justice, is supposed to make frustrating, difficult decisions when justice calls for such decisions to be made. What was the majority\’s opinion when race was removed from the de facto \”definition\” of marriage in Loving v. Virginia? A U.S. President and 118 members of Congress decided to define \”marriage\” and the distribution of more than 1000 federal benefits that accompany this definition for millions of U.S. citizens. So, is the argument that because we don\’t have a 2:1 margin in the country supporting same-sex marriage that we are stuck with this draconian definition that is based on \”history,\” and that history\’s rationale is that the purpose of marriage is procreation? Are we not in 2013 with the Internet and assisted reproductive technology? And, speaking of technology, \”newer than cell phones\” is an insulting comparison to a relationship with all the hallmarks of a marriage except the label and, more importantly the rights that are afforded that \”label.\” The cell phone analogy could arguably be found swimming in the ocean of reductio ad absurdum, which is arguably surprising coming from a Justice of the United States Supreme Court. As Justice Kennedy pointed out, more than 40,000 children in California alone are subjected to the marginalization of their families by a law that has no place in a civil society. The Justice referred to the emotional stigmatization these children face, but what about the financial benefits that the federal government attributes to married couples? If a child is living in a home with same-sex parents who, e.g., cannot take advantage of filing jointly on federal tax returns and discounts provided in medical and other benefits via ERISA and other government agencies, then money is being taken away from that family and, therefore, that child. So while I applaud Justice Kennedy for directing the public\’s attention to the children who are adversely affected by the so-called Defense of Marriage Act (DOMA) and its proponents, in my authentically humble opinion, the argument should have and could have gone further than what appears to be a gratuitous tug at the heartstrings. Becoming a lawyer, I was told and always take to heart that those with great gifts have an equally great responsibility and must not turn away from that responsibility when it calls for making difficult choices, such as whether to provide all U.S. citizens with all of the rights of marriage or no U.S. citizen with a cohesive, civil, and just legal foundation for loving, committed relationships.
90-Second Legal Analysis of Same-Sex Marriage Issues
Courtesy of Bloomberg Law via JDSupra. For a deeper look at relationship rights and the courts, visit our \”Love and the Law\” series.