Q:       I heard legally married same-sex couples will now be treated as married for federal tax purposes. I was married in a state that allows same-sex marriages, but recently moved to a state that does not recognize our marriage. Will the IRS still recognize us as married for tax purposes even if our current state of residence does not?

A:        Yes. Due to a recent U.S. Department of the Treasury and Internal Revenue Service (IRS) ruling that takes effect Sept. 16, 2013, same-sex couples who were legally married in jurisdictions recognizing their marriages are to be treated as married for federal tax purposes. The ruling applies even if the couple lives in a jurisdiction that does not recognize same-sex marriage. This ruling implements federal tax aspects of the June 26, 2013 U.S. Supreme Court decision that invalidated a key provision of the 1996 Defense of Marriage Act.

Q:       What “federal tax purposes” does the ruling cover?
A:        Under the ruling, same-sex couples will be treated as married for all federal tax purposes, including income and gift and estate taxes. The ruling applies to all federal tax provisions where marriage is a factor, including filing status, claiming personal and dependency exemptions, taking the standard deduction, employee benefits, contributing to an IRA and claiming the earned income tax credit or child tax credit.

Q:       Does the ruling apply to registered domestic partnerships?

A:        No. The ruling covers any same-sex marriage legally entered into in one of the 50 states, the District of Columbia, a U.S. territory or a foreign country, but it does not apply to registered domestic partners, who are not married under state law.

Q:       How should legally married same-sex couples file their 2013 federal income tax return?

A:        Beginning Sept. 16, any return filed by legally married same-sex couples generally must use either the “married filing jointly” or “married filing separately” filing status. Individuals who were in same-sex marriages may, but are not required to, file original or amended returns choosing to be treated as married for federal tax purposes for one or more prior tax years still open under the statute of limitations. 

Q:       What is the statute of limitations for filing a tax refund claim?

A:        Generally, you have three years from the date the return was filed or two years from the date the tax was paid, whichever is later, to file your claim. This means that in 2013 you can file refund claims for tax years 2010, 2011 and 2012. In some special circumstances (such as signing an agreement with the IRS to keep the statute of limitations open), taxpayers may be allowed to file refund claims for tax years 2009 and earlier.

Q:       I bought same-sex spouse health insurance coverage from my employer on an after-tax basis. Do I get any credit for that?

A:        Yes. You may treat the amounts you paid for that coverage as pre-tax and exclude those amounts from your taxable income.

Q:       How do I file a refund claim?

A:        To file a refund claim for income taxes, you should use Form 1040X, Amended U.S. Individual Income Tax Return. To file a refund claim for gift or estate taxes, use Form 843, Claim for Refund and Request for Abatement. For information on filing an amended return, see Tax Topic 308, Amended Returns, available on IRS.gov, or the Instructions to Forms 1040X and 843. You can find information about where to file your amended returns in the form instructions.

Q:       Will employers receive guidance about getting refunds for past benefits provided to same-sex spouses?

A:        Yes. The U.S. Treasury and the IRS intend to issue streamlined procedures for employers wishing to file refund claims for payroll taxes paid on previously taxed health insurance and fringe benefits provided to same-sex spouses. The Treasury and IRS also intend to issue further guidance on cafeteria plans and on how qualified retirement plans and other tax-favored arrangements should treat same-sex spouses for periods prior to the revenue ruling’s effective date of Sept. 16, 2013. Other government agencies also may provide guidance related to same-sex marriage on the federal programs they administer.

Q:       Where can I get more information?

A:        Visit www.IRS.gov for Revenue Ruling 2013-17, and to find updated Frequently Asked Questions (FAQs) about same-sex couples, registered domestic partners and individuals in civil unions.

This “Law You Can Use” column was prepared by the Ohio State Bar Association (OSBA). The information was provided by the Internal Revenue Service (www.IRS.gov). The column offers general information about the law. Seek an attorney’s advice before applying this information to a legal problem. For more information on a variety of legal topics, visit the OSBA’s website at www.ohiobar.org.

            Ohio’s recently opened casinos give residents an increasing number of in-state gambling options, but whether gambling takes place at a state casino, a racetrack or elsewhere, gamblers should be aware that tax consequences may follow.

Q:        Do I have to report my gambling winnings on my federal tax return?

A:        Yes. Gambling winnings are generally taxable and must be reported your tax return. If you file IRS Form 1040, report your gambling winnings on the “other income” line (line 21). Other income includes winnings from lotteries, raffles, horse races and casinos. It also includes cash winnings and the fair market value of prizes, such as cars and trips.

Q:        Isn’t it true that I only have to report my winnings if a gaming organization gives me an income tax form?

A:        No. It is a common misconception that you don’t need to report gambling winnings on your federal tax return unless you receive a Form W-2G from the payer. In fact, you must report your gambling winnings even if you did not receive documentation when you won the money or prize.

Q:        If I have to report all of my gambling winnings anyway, then why bother with Form W-2G?

A:        The gaming organization or other payer of gambling winnings must issue Form W-2G (“Certain Gambling Winnings”) to winners under certain circumstances. For example, if the gambling winnings are subject to federal income tax withholding, the payer should issue the winner a Form W-2G. Winners should also receive forms when they have:

• $1,200 or more in gambling winnings from bingo or slot machines;
• $1,500 or more in proceeds (the amount of winnings minus the amount of the wager) from keno;
• More than $5,000 in winnings (reduced by the wager or buy-in) from a poker tournament;
• $600 or more in gambling winnings (except winnings from bingo, keno, slot machines and poker tournaments) and the payout is at least 300 times the amount of the wager.

Q:        If I itemize deductions, can I at least offset my gambling winnings with my losses?

A:        Yes, but you can’t deduct gambling losses that exceed your winnings. Also, you can’t simply reduce your gambling winnings by your gambling losses and report the difference. You must report the full amount of your winnings as income, and then claim allowable losses separately. To claim gambling losses up to the amount of your total winnings, use Form 1040, Schedule A, “Itemized Deductions,” under “Other Miscellaneous Deductions.”

            If you plan to deduct your gambling losses, you must have receipts, tickets, statements and documentation such as a diary or similar record of your losses and winnings. Your records should show winnings separately from losses. IRS Publication 529, “Miscellaneous Deductions,” provides details about the type of information you should keep in a gambling win/loss diary and the kinds of proof you should keep in your records.

Q:        Where can I get more information about gambling income and losses?

A:        For more information, see IRS Publication 529 or Publication 525, Taxable and Nontaxable Income. Both publications are available at IRS.gov, or you can call 800-TAX-FORM (800-829-3676). You can also type “gambling” in the IRS.gov search box to find articles about reporting and deducting gambling winnings.

The information for this “Law You Can Use” column was provided by the Internal Revenue Service. It was prepared by the Ohio State Bar Association. Articles appearing in this column are intended to provide broad, general information about the law. Before applying this information to a specific legal problem, readers are urged to seek advice from an attorney.

Q:       I just realized that I could have claimed a tax credit this year, but I’ve already filed my return. Is there anything I can do?

A:        Yes. You can file an amended return using IRS Form 1040X. If you are eligible to claim a credit, or perhaps a deduction that reduces your tax bill, you should do so.

Q:       What if I’ve made a mathematical error on the tax return I already submitted?

A:        Generally, you do not need to file an amended return to correct mathematical errors because the IRS will automatically make such corrections and send you a printed notice. Also, amended returns should not be filed for forgotten tax forms such as W-2s or schedules; the IRS normally will mail you a notice asking you for any such forms if they are needed.

Q:       What if I’ve forgotten to report income?

A:        If you’ve forgotten to report income, you should file an amended return as soon as possible. The sooner you correct such a mistake, the lower any possible penalties and interest you may owe will be. Reporting the additional income on a 1040X form could save you money in the long run.

Q:       Can I submit a 1040X form electronically?

A:        No. Form 1040X must be filed using the paper form and mailed in. If you are amending more than one tax return, each 1040X form should be mailed in a separate enveloped addressed to the appropriate IRS processing center.

Q:       How much time do I have to file an amended return?

A:        An amended return must be filed within three years from the date of the original return or within two years from the date taxes were paid, whichever is later.

Q:       How long will it take the IRS to process my amended return?

A:        According to the IRS, it generally takes between eight and 12 weeks to process an amended return.

Q:       Where can I find more information?

A:        For more information about amended returns or to print a copy of Form 1040X, go to www.irs.gov and click on the link to Forms and Publications, or visit the IRS YouTube channel: www.youtube.com/watch?v=JUjC0avoZ_I.

The information for this “Law You Can Use” column was provided by the Internal Revenue Service. It was prepared by the Ohio State Bar Association. Articles appearing in this column are intended to provide broad, general information about the law. Before applying this information to a specific legal problem, readers are urged to seek advice from an attorney.