I registered my girlfriend (opposite-sex) as a domestic partner to get health insurance through my employer. We were married in October last year. The benefits we received for the first 3/4 of the year were treated as imputed income, and added to my income on my W2. The last 1/4 of the year, her health benefits weren’t treated as income, since we were married.

Do I have to report the benefits for the first 3/4 of the year as income when filing taxes? Or, can I deduct those benefits and consider us married for the complete year as I will for the rest of my tax return? Should I ask my employer to change my W2 to remove the health benefits from my income?

Thanks to anyone who can help!

YOUR STATEMENT:
“One case where FSAs might be used for same-sex partners: The partner meets criteria under the Working Families Tax Relief Act (WFTRA). Under WFTRA, the partner must live with the employee for more than half the year and receives more than half his or her support from the employee.”

Unlike typical benefits for spouses and dependents, domestic partner benefits are subject to both federal and state tax as a form of compensation, according to the Partners Task Force for Gay and Lesbian Couples.

In terms of administration, however, benefits such as paid bereavement leave tend to work the same in terms of their tax treatment.

I’m in Ohio and my boyfriend and I are domestic partners and I’m registered with my employer as having a domestic partner…but we still have to file our taxes as single…but according to this statment I can be taxed for benefits that he may use from my employer but we can’t file jointly for any tax breaks as a married couple would (I’m female)? If I understand that correctly…that’s crap!

As defined in IRC §152, a “qualifying child” must be the natural or adopted child of the taxpayer (or bear other specified relationship to the taxpayer) and also meet the following requirements:

have the same principal place of abode as the taxpayer for more than one-half of the taxable year,
satisfy age requirements (i.e., must not have attained age 19 before the close of the calendar year in which the taxable year of the taxpayer begins if not a student or, if a student, must not have attained age 24 before the close of the calendar year in which the taxable year of the taxpayer begins, or must be permanently and totally disabled), and not have provided over one-half of such individual’s own support for the calendar year in which the taxable year of the taxpayer begins.

A child who does not qualify as a “qualifying child” may be considered a tax dependent under the definition of a “qualifying relative” if you provide over half the child’s support and satisfy other requirements. The qualifying child and qualifying relative rules can be found in IRS publications. Check with IRS (http://www.irs.gov, 1-800-829-4933, TDD 1-800-829-4059) or your tax advisor for detailed IRS qualification rules.

In 1996, that changed with the Defense of Marriage Act (DOMA). DOMA says that “in determining the meaning of any Act of Congress, or of any ruling, regulation, or interpretation of the various administrative bureaus and agencies of the United States, the word ‘marriage’ means only a legal union between one man and one woman as husband and wife, and the word ‘spouse’ refers only to a person of the opposite sex who is a husband or a wife.”

Therefore, an employee’s domestic partner cannot qualify as a spouse for purposes of excluding employer-provided health benefits from the employee’s taxable income.
See also the IRS definition of spouse in § 152

See also page # 10
http://www.irs.gov/pub/irs-wd/0524016.pdf