ACLU: New Department of Taxation policy discriminates against LGBT Virginians

A Nov. 8 Virginia Department of Taxation bulletin concerning treatment of legally married same-sex couples and their employers under Virginia’s tax laws is coming under fire from the ACLU of Virginia.

According to the bulletin, the marital status of a couple for Virginia income tax purposes is historically based on whether the couple is considered married for federal income tax purposes. Citing the state constitutional amendment passed in 2006 prohibiting the recognition any marriage in Virginia other than a marriage between one man and one woman, the Department of Taxation has decided to deviate from a Sept. 16 IRS ruling that provides that “same-sex couples will be treated as married for federal tax purposes if they were legally married in a state that recognizes same-sex marriage, regardless of whether such couples lives in a jurisdiction that recognizes same-sex marriage.”

“Accordingly, same-sex married couples who file federal income tax returns jointly, or as married taxpayers filing separately, will be required to file their Virginia income tax returns as single individuals,” according to the Nov. 8 Virginia Department of Taxation bulletin.

“This bulletin reaffirms the Commonwealth’s ongoing hostility toward gay, lesbian, bisexual, and transgender (LGBT) Virginians, including legally married same-sex couples,” said Claire Guthrie Gastañaga, executive director of the ACLU of Virginia.

“Instead of embracing the U.S. Supreme Court decision that found the Defense of Marriage Act unconstitutional, Virginia has signaled its continued opposition to basic fairness by singling out same-sex married couples for discriminatory treatment under state tax laws. The tax department’s ruling, which includes no citations to the authority under which it was issued, is inconsistent with federal income tax laws and is in conflict with the state law that requires conformity with federal rules,” Gastañaga said.

“The tax department’s ruling doubles down on its discriminatory stance toward LGBT Virginians by also penalizing private Virginia businesses that abide by federal tax rules that allow employers the ability to claim a federal tax deduction for fringe benefits to employees’ same-sex spouses and dependents.  Under the new policy announced by the tax department, Virginia businesses that utilize the federal tax deduction must adjust their state tax filings to reflect the Commonwealth’s refusal to recognize legally married same-sex couples,” Gastañaga said.