DOMA Ruled Unconstitutional

This morning, in United States v. Windsor, the United States Supreme Court ruled that the Defense of Marriage Act (also known as “DOMA”) is unconstitutional because it violates the 5th Amendment’s guarantee of equal protection.  Therefore, same-sex marriages that are valid under state law will be recognized for purposes of federal laws.

  While on the surface this appears to be a primarily social issue, the Windsor decision will have major implications for the operation of employee benefit plans.  Depending upon whether an employer intends to offer coverage to same-sex spouses, it may be necessary for plan sponsors to amend their documents.  In addition, this decision modifies the tax treatment of any such coverage extended to same-sex spouses.

The effect of the Supreme Court’s opinion in the companion case of Hollingsworth v. Perry on the benefits community is less clear.  The court found that the supporters of California’s ban on same-sex marriage lacked standing to appeal the decision of the lower court which found the ban unconstitutional.  Therefore, while same-sex marriage will be recognized in California, it appears that individual states are permitted to ban same-sex marriage within their borders—for now.

Fraser Trebilcock’s employee benefits experts can help you navigate the consequences of these developments for your plans. To connect with one of our attorneys, contact our office at 517.482.5800.

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