CNBC host Suze Orman on Monday said the Defense of Marriage Act “unnecessarily” costs gays and lesbians millions of dollars.
“The social and civil discrimination that goes on when it comes to gay marriage is absolutely inexcusable,” she said. “The financial discrimination just really really adds injury to insult.”
Orman is among those who spoke during a Respect for Marriage Coalition conference call with reporters that highlighted the inequities same-sex couples continue to face in federal and state tax systems.
Some states in which gays and lesbians can legally marry allow same-sex couples to file joint tax returns, but Orman noted there are roughly 1,100 ways they “are discriminated against” within the federal tax-paying system. These include the up to $7,000 more in taxes each year a gay person would have to pay if they placed their same-sex partner or spouse on their health insurance plan, the inability to rollover an IRA and collect Social Security survivor benefits she said “just as you do if you’re heterosexual.”
Orman, who married her partner Kathy Travis in South Africa three years ago, added she and other gays and lesbians would have to pay additional estate taxes that heterosexual couples do not because the federal government does not recognize their marriage.
“For many people that are in my situation, it is absolutely ridiculous that upon my death K.T. is going to have to pay estate tax on the majority of my estate and I’m going to have to pay estate tax on the majority of her estate,” Orman said. “If we were married and recognized on a federal level, we would not owe one penny.”
Orman spoke on the same day millions of Americans were filing their federal and state taxes before the midnight deadline.
The U.S. Supreme Court on March 27 heard oral arguments in a case filed by New York City widow Edith Windsor that challenges the constitutionality of DOMA. Windsor, who married her partner of more than 40 years, Thea Spyer, in Canada in 2007, paid $363,000 in estate taxes after her 2009 death.
Mark Maxwell and Timothy Young-Maxwell of Winston-Salem, N.C., noted during the call they are also unable to file a joint state tax return because North Carolina does not recognize their D.C. marriage.
The couple, who has lived together in the Tarheel State for more than two decades and have four adopted sons, noted their tax accounting fees cost twice the amount of money because they cannot file jointly. Maxwell also noted the costs associated with adding his spouse to his employer’s health insurance plan are also high.
“We spend more money because the money that I receive to pay for his insurance is taxed,” Young-Maxwell said. “We could use that to pay down our mortgage or pay for our children’s college education.”
The two men are the sole legal guardians for two of their four children because they cannot jointly adopt them under North Carolina law. The state gives adoptive families an annual stipend of $2,400 for each child until they turn 18 to help them offset the costs of caring for them, but the non-adoptive parent is ineligible to receive it because the Tarheel State does not recognize same-sex marriages or second-parent adoptions.
“We feel at this time that we’re unfortunately second class citizens in our country and our children are treated as second class citizens as well,” Maxwell said.
Elda Di Re and Karyn Twaronite of Ernst and Young LLP also took part in the teleconference.