A tax controversy may have arisen after a federal appeals court issued a decision in regard to the Defense of Marriage Act, known as DOMA. The Court of Appeals for the Second Circuit in New York declared that the law is unconstitutional. Another federal appeals court made the same conclusion prior to New York's decision. The United States Supreme Court may be called on to weigh in on the constitutionality of the act in the future. The current federal tax code does not recognize gay marriage. However, if the Supreme Court strikes down the constitutionality of DOMA, gay couples who are legally married could then file a claim for a refund of federal tax overpayments. Six states currently recognize same-sex marriage, including Massachusetts. Gay-rights activists and accountants have recommended that same-sex couples should file a protective refund claim. This claim goes to the Internal Revenue Service. This strategy will allow couples to receive a larger refund if the U.S. Supreme Court strikes down DOMA.
The Internal Revenue Service is not known for making things easy on taxpayers. This is certainly true when it comes to same-sex couples who need to file taxes in Massachusetts. The reason the problem is so confusing for many is that the federal government does not yet recognize same-sex marriages or civil unions. And this lack of recognition applies to the IRS as well.