Same-Sex Married Couples Living in State That Does Not Recognize Same-Sex Marriages


So what does the recent Supreme Court decision regarding same-sex marriages (United States v. Windsor) mean for a same-sex couple who  legally marry in a state which allows same-sex marriages, but moves to and lives in a state which does not recognize the marriage?  In other words, what happens if a couple legally marries in Massachusetts and then moves to Missouri?  

The short answer is we really don't know.  The Supreme Court decision making a portion of DOMA unconstitutional did not address this issue.  Here are some initial thoughts:

  • Use AB or Credit Shelter Trust Planning for Estate Tax and Asset Protection planning - Married couples may be able to shelter two times the applicable exclusion amount.
  • Make Unlimited Gifts to Each Other - Married couples may be able to take advantage of the unlimited marital deduction to equalize their estates prior to death.
  • Make Use of Portability - The surviving spouse may be able to pick up their deceased spouse's unused federal estate tax exemption and add it to their own.
  • Rollover IRAs - The surviving spouse may be able to roll over an IRA inherited from their deceased spouse into their own IRA.
  • Receive Social Security Survivor Benefits - The surviving spouse may be able to receive Social Security survivors' benefits based on their deceased spouse's earnings.

This is just the tip of the iceberg. With over 1,100 federal benefits tied to marriage, how same sex married couples who live in states that do not legally recognize their marriage will be treated in view of the Windsor decision will take a while to be sorted out.