In U.S. v. Windsor, the United States Supreme Court struck down a provision of the Defense of Marriage Act (DOMA), which limited the definition of marriage to a legal union between a man and a woman. The Court held that section 3 of DOMA violates the Fifth Amendment’s Equal Protection Clause as it pertains to same-sex couples who are legally married pursuant to the laws of a state where same-sex marriages are recognized. The underlying facts of the case involved the IRS’s refusal to issue a refund of federal estate taxes sought by the surviving spouse of a same-sex couple who were married in Canada and resided in New York, where their marriage was legally recognized.

Prior to the Court’s ruling in U.S. v. Windsor, the IRS had recognized the marital status for federal tax purposes of individuals who entered into common-law marriages, but interpreted DOMA as prohibiting it from recognizing same-sex marriages for purposes of applying the many tax code provisions which reference the marital status of taxpayers. Following U.S. v. Windsor, the IRS issued Revenue Ruling 2013-17, stating that “individuals of the same sex will be considered to be lawfully married under the Code as long as they were married in a state whose laws authorize the marriage of two individuals of the same sex, even if they are domiciled in a state that does not recognize the validity of same-sex marriages.” There are more than 200 federal tax code rules and regulations that include the terms “spouse” or “marriage,” or related definitions. With this ruling, the IRS has now determined that such terms, as well as “husband” and “wife,” will now include legally married same-sex couples.

The practical outcome of U.S. v. Windsor and Revenue Ruling 2013-17 is that now a number of tax and estate planning benefits are available to same-sex married couples, including joint tax return filing, the unlimited marital deduction for federal estate tax purposes, portability of their deceased spouse’s unused federal gift and estate tax exemption, and gift-splitting of their annual gift tax exclusion amounts.