Understanding Civil Union Tax Filing Status
Civil unions are legal relationships granted by some states, designed to provide couples—often same-sex couples before marriage equality—with legal rights similar to marriage. However, the federal government, including the IRS, only recognizes marriages valid under federal law when it comes to tax filing. As a result, partners in a civil union typically cannot file federal taxes jointly like married couples.
Background: Civil Unions and Tax Filing
Before nationwide marriage equality was established by the Supreme Court’s 2015 Obergefell v. Hodges decision, many states offered civil unions or domestic partnerships to provide legal protections for couples. While states recognized these unions differently, the federal government did not extend marriage-related tax benefits to civil union partners, leading to discrepancies in tax filing.
Federal Tax Filing for Civil Union Partners
The IRS recognizes five filing statuses: Single, Married Filing Jointly, Married Filing Separately, Head of Household, and Qualifying Widow(er). Civil union partners do not qualify as “married” under federal law, so they cannot file jointly. Each partner must file as “Single” or may qualify as “Head of Household” if they meet specific criteria, such as supporting dependents.
Key points:
- Civil union partners must file separately on federal returns.
- Filing jointly at the federal level is not permitted for civil union partners.
- Many federal tax benefits exclusive to married couples, such as the Earned Income Tax Credit (EITC) and certain deductions, are typically unavailable to civil union partners.
State Tax Filing: Variation by Jurisdiction
Many states recognize civil unions or similar partnerships for state tax purposes and allow couples to file jointly. This leads to situations where couples file as singles federally but jointly for state taxes. Examples include:
- States like Colorado, Illinois, and New Jersey recognize civil unions for state taxes and permit joint filing.
- Other states do not recognize civil unions, so partners must file individually for both federal and state taxes.
This mixed system can complicate tax preparation and requires careful attention to both federal and state requirements.
Real-World Examples
- Alex and Jordan live in a state recognizing civil unions for state tax purposes. They file federal tax returns as singles but file jointly for the state tax return, potentially reducing their state tax burden.
- Casey and Taylor reside in a state that does not recognize civil unions. They file both federal and state taxes individually as singles.
- Jamie and Sam married after the legalization of same-sex marriage. Before marriage, when only in a civil union, they filed separately federally but could file jointly in their state. After marriage, they file jointly federally and at the state level.
Who Should Be Concerned?
This filing status impacts couples legally in civil unions, particularly those living in states that recognize civil unions but where federal tax law does not. Understanding these distinctions is crucial to avoid filing errors and penalties.
Tips for Civil Union Tax Filers
- Verify your state’s recognition of civil unions and related filing options on your state department of revenue website.
- File federal taxes as “Single” unless legally married.
- Consult a tax professional if your filing situation involves mixed federal and state recognition.
- Maintain thorough records of your civil union documentation.
- Review how filing separately may affect your eligibility for tax credits and deductions.
- Adjust withholding or estimated tax payments to avoid underpayment penalties.
Common Misconceptions
- Civil union partners cannot file jointly with the IRS like married couples.
- Civil unions are not equivalent to marriage under federal tax law.
- Filing as “Single” does not automatically mean paying more tax; state benefits and deductions can impact your total liability.
Frequently Asked Questions
Q1: Can civil union partners file jointly on their federal tax returns?
- No. Federal law only permits joint filing for legally married couples.
Q2: Does the IRS recognize civil unions as marriages?
- No. The IRS recognizes only marriages that meet federal legal standards.
Q3: Can civil union partners file jointly for state taxes?
- It depends on the state. Some states recognize civil unions for state tax purposes and allow joint filing.
Q4: What happens if a couple in a civil union gets legally married?
- They gain the ability to file jointly for both federal and state taxes.
Q5: Are married couple tax benefits available to civil union partners?
- Many federal tax benefits require legal marriage and thus are not available to civil union partners.
Summary Table: Civil Union Tax Filing Status Differences
| Aspect | Federal Taxes | State Taxes (Varies by State) |
|---|---|---|
| Recognized as Marriage? | No | Sometimes Yes |
| Filing Status Options | Single, Head of Household* | Single, Joint, or other options depending on state |
| Ability to File Jointly | No | Possible in states recognizing civil unions |
| Access to Married Couple Tax Benefits | No | Possibly yes |
| Common Filing Challenge | Confusion about status | Adhering to varying state rules |
*Note: Head of Household requires qualification based on dependents and living situation, not civil union status.
Additional Resources
For detailed IRS information on filing status, visit IRS Filing Status and IRS FAQs on Same-Sex Marriage and Civil Unions.
For state-level information and practical advice, consult resources such as ConsumerFinance.gov and Kiplinger.
By understanding the nuances of Civil Union Tax Filing Status, couples can better navigate both federal and state tax systems, ensuring compliance and optimizing their tax outcomes.