The Unnoticed Effects of DOMA

I am in the midst of negotiating the settlement of some issues in a case on behalf of my client. My client and the soon-to-be-ex have been together for 17 years and have two very young children. There is a substantial amount of property involved. There are businesses, a residence, rental properties, retirement benefits and the like. There are arguments over what the custody arrangements should be. There are arguments over who should control what assets, and what the amount of child and spousal support should be.

This case has the same trappings as many other divorces. A long-term relationship which, for any number of reasons, has reached its end point. It is time for both parties to move on, and the question is how to enable that while fairly addressing the division of property, support arrangements, and the custody of their children.

In trying to work through the issues with my opposing counsel the other day, we ran into a stumbling block. His client would be the one to pay spousal support to my client. As most lawyers know, according to Federal tax law, spousal support when paid pursuant to a court order or written agreement is tax deductible to the spouse who pays it, and is included in the taxable income of the spouse who receives it. It is the tax-deductibility aspect of spousal support that allows us, as lawyers, to try to come up with creative ways to address the issue if at all possible. We try to maximize the tax benefit and use it in a way that reduces overall income tax liability to maximize the dollars that exist to benefit the now-separated family.

In this case, however, there is a problem: My client is a man, and the other party is also a man. Therefore, under the "Defense of Marriage Act" (DOMA), we cannot apply the same principles to this arrangement as we would to every other divorce. While the alimony would be deductible under California law, it is not deductible under Federal law and that is where the most significant benefit comes because these parties are at an income level where they would pay the maximum federal tax rate.

Up until this last paragraph, you probably thought that this was, in many ways, a "run-of-the-mill" divorce. And the truth of the matter is that this is exactly what it is. Both of the parties involved have been productive members of our society all of their adult lives. Through hard work, they have acquired a fairly sizable estate. They set up a household, they had children, and they arranged both their domestic roles and their financial affairs in a way intended to benefit those children. Through all of this they did the same thing that we all do: They paid taxes on the income that they earned. Those taxes contributed to the cost of running our enormous government, and they provided benefits to other Americans in other parts of the country. By paying their taxes, they contributed to the costs of the wars in Afghanistan and Iraq, they provided funds for police protection for their fellow citizens, they provided welfare benefits to indigent people. They did exactly what every other couple does who acquired wealth during the course of their relationship and legally paid their taxes. Yet, now that they are getting a divorce, they are not entitled to this benefit that is available to any heterosexual married couple that is getting divorced in this country. They are not entitled to it for only one reason: they are both men.

On Monday, the Justice Department filed a brief in a pending California Federal District Court lawsuit wherein it took the position that the 13-year-old Defense of Marriage Act should be repealed because it is discriminatory. The act prevents the Federal Government from recognizing the validity of same-sex marriages. It prevents Federal employees' spouses (if they are of the same gender) or domestic partners from receiving benefits, the same benefits that are offered to opposite sex domestic partners and spouses. In an unusual deviation from the "Full Faith and Credit Clause" of the U.S. Constitution, it allows one state to decline recognition of a marriage between people of the same gender which is valid in another state which allows same sex marriages.

The effects of the Defense of Marriage Act are often far-reaching and unrealized by many. Some of the effects are more obvious than others. The issue in this case is probably not one that many would even think of. However, each and every day there are American citizens who productively contribute to our nation, comply with our laws, and who are not treated equally solely based upon their sexual orientation. If we intend to accept the benefits of their contributions to society, we must extend to them the protections of our society. Until DOMA is repealed, "Equal Justice Under Law," the inscription on the building which houses the United States Supreme Court, will have no meaning. As Americans, we should not wait until that court hears the issues, to give every American equal justice.