Understanding the U.S. Same-Sex Spouse Relationship

This topic describes the same-sex spouse relationship as assigned by the U.S. Federal Government.

You can define health care premium and life insurance benefit rates attributed to U.S. same-sex spouse for taxation by state and local jurisdictions that do not recognize same-sex marriages.

On August 29, 2013 the IRS published IR-2013-72 stating that the U.S. Department of Treasury and the IRS ruled that same-sex couples, legally married in a jurisdiction that recognizes same-sex marriage, will be treated as married for federal purposes. The ruling applies regardless of whether the couple currently resides in a jurisdiction that recognizes same-sex marriage or in a jurisdiction that does not recognize same-sex marriage.

As per the IRS ruling, employees who purchase same-sex spouse health insurance coverage from their employers may treat the amounts paid for that coverage as pre-tax and excludable from income. This ruling affects taxation of spousal benefits including health and accident benefits (including employee pre-tax contributions under IRC Section 125 plan), health savings accounts, health reimbursement arrangements, and long-term care.

PeopleSoft HCM applications enable employers in states that do not recognize same-sex marriage to process benefits and taxes for the new same-sex spouse dependent relationship. Specifically, PeopleSoft HR Manage Base Benefits enables users to define the health care premium rates and life insurance rates attributed to same-sex spouse for states and local jurisdictions that do not recognize same-sex marriages.