States Tax Rules for Same-Gender Couples

A number of states have released guidance regarding state income taxation for same-gender married couples.

In August, the Internal Revenue Service (IRS) issued guidance stating it will recognize same-gender couples married in states for which it is legal for them to do so as married for federal income tax purposes regardless of the state they currently reside (see “IRS Provides Procedures for Same-Sex Marriage Tax Credits”). It is still up to the individual states whether they will regard these individuals as married or single.

According to the ADP Research Institute, states that do not sanction same-gender marriages, but have decided to recognize them for state income tax purposes, include Missouri and Oregon. States that do not sanction same-gender marriages and will not recognize them for state income tax purposes include Arizona, Georgia, Idaho, Kansas, Louisiana, Michigan, Mississippi, Nebraska, North Carolina, North Dakota, Ohio, Oklahoma, Utah, Virginia and Wisconsin.

The following states do not sanction same-gender marriages and have not announced whether they will recognize them for state income tax purposes: Alabama, Arkansas, Colorado, Indiana, Kentucky, Montana, Pennsylvania, Puerto Rico, South Carolina and West Virginia.

The New Mexico Supreme Court issued a ruling today legalizing same-gender marriages in that state.

The ADP Research Institute notes that California, Connecticut, Delaware, Washington, D.C., Hawaii, Iowa, Illinois (effective June 1, 2014), Maine, Maryland, Massachusetts, Minnesota, New Hampshire, New Jersey, New York, Rhode Island, Vermont and Washington sanction same-gender marriages. Arkansas, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming have no state income tax withholding.

The Institutes Legislative Updates can be accessed here.