Yesterday, the U.S. Supreme Court ruled in a 5-4 vote that Section 3 of the Defense of Marriage Act (DOMA) is unconstitutional. The decision in United States v. Windsor means that same-sex couples who are married under state law will be treated as married for purposes of more than 1,000 federal laws that previously applied only to opposite-sex married couples. Such laws include those governing federal income taxation, Social Security benefits, veterans’ benefits, criminal sanctions, and housing. This decision has far-reaching implications for employers and individuals, ranging from employee benefit plans and employer policies to estate planning and the preparation of federal income tax returns.

Before yesterday's decision, Section 3 of DOMA, which was enacted in 1996, provided that the word "marriage" in any federal law or regulation (including those that address employee benefits) means only "a legal union between one man and one woman as husband and wife," and the word "spouse" refers only to a "person of the opposite sex who is a husband or a wife."

In United States v. Windsor, Edie Windsor and Thea Spyer, a same-sex couple who lived in New York, married in Canada. When Ms. Spyer died, DOMA prevented the Internal Revenue Service (IRS) from recognizing their marriage, despite New York legally recognizing same-sex marriages performed in other jurisdictions. As a result, the IRS refused to extend the unlimited spousal deduction for federal estate tax purposes and denied Ms. Windsor's refund request for the federal estate taxes she paid on her inheritance of her wife's estate. If DOMA had not precluded the IRS from recognizing the same-sex marriage as it would a valid opposite-sex marriage under New York law, Ms. Windsor would have qualified for an unlimited spousal deduction and would have paid no federal estate taxes.

In Windsor, the Supreme Court held that DOMA violated the due process clause of the Fifth Amendment to the U.S. Constitution, which prohibits denying any person the equal protection of the laws. The Court explained in its opinion how marriage has historically been a decision that was left to the states and that the federal government, throughout history, has deferred to state law in such matters. According to the Court, however, DOMA’s principal effect is to impose inequality, thus rendering it unconstitutional.

The decision did not address state laws that define marriage as being only between a man and a woman. Current litigation challenging the constitutionality of those laws will continue.

In conjunction with its ruling in Windsor, the Court also issued an opinion in Hollingsworth v. Perry. In this case, public officials refused to defend the constitutionality of a ballot initiative (Proposition 8), which amended the California Constitution to ban same-sex marriage. The Court held that sponsors of the ballot initiative, who brought suit to defend Proposition 8, did not have standing to do so. As a result, the Ninth Circuit’s decision that Proposition 8 was unconstitutional was vacated, and the case was remanded for further review. In the interim, California is likely to resume performing same-sex marriages.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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