IRS Provides Additional Guidance on Treatment of Same-Sex Marriages under Benefit Plans

by Pillsbury Winthrop Shaw Pittman LLP

In IRS Notice 2015-86, the Internal Revenue Service (IRS) provided guidance to sponsors and administrators of employee benefit plans regarding the application of the U.S. Supreme Court’s decision in Obergefell v. Hodges to plan participants with same-sex spouses.

Supreme Court Decisions and Prior IRS Guidance

On June 26, 2013, the U.S. Supreme Court in United States v. Windsor held that Section 3 of the Defense of Marriage Act—which limited the definition of “marriage” to marriage between a man and a woman for all purposes under Federal law—was unconstitutional. In response to that decision, the IRS released Revenue Ruling 2013-17 indicating that, effective as of September 16, 2013, same-sex spouses would be treated as married for all Federal tax purposes as long as the marriage was validly entered into in a state or country whose laws authorize same-sex marriage (generally referred to as the “state of celebration” rule). The IRS issued further guidance in Revenue Ruling 2014-19 on the timing and scope of required plan amendments to comply with Windsor. For further information about these prior IRS rulings, please see our prior Client Alerts from September 3, 2013 and April 9, 2014.

The Windsor decision and IRS guidance did not require states to modify their civil marriage laws or to recognize same-sex marriages performed in other states. Earlier this year, however, the U.S. Supreme Court held in Obergefell v. Hodges that states are required to apply their civil marriage laws to same-sex couples on the same terms and conditions as opposite-sex couples, and that states are prohibited from refusing to “recognize a lawful same-sex marriage performed in another State on the ground of its same-sex character.” Because Obergefell requires that states recognize marriages of same-sex couples performed in other states, certain marriages performed in previous periods will be recognized for the first time for state law purposes.

The Obergefell decision prompted many plan sponsors to ask whether they need to adopt new plan amendments or changes in administrative practices with respect to same-sex marriages. Sponsors have also been considering whether to adopt voluntary amendments providing additional benefits and protections for participants with same-sex spouses. Notice 2015-86 was issued to address concerns raised by those plan sponsors.

Guidance for Qualified Retirement Plans

Because Obergefell does not change the Federal definition of marriage from the “state of celebration” rule already endorsed under Windsor, Notice 2015-86 confirms there are no mandatory changes for qualified retirement plans beyond those previously required under Windsor and the prior IRS guidance. However, a sponsor may want to amend its qualified retirement plans to provide additional benefits and protections for participants with same-sex spouses, such as offering a new joint and survivor annuity election in cases where the participant was previously required to begin receiving a single life annuity. Because these would be discretionary and not mandatory amendments, the Notice cautions that the amendments would be subject to the same funding restrictions (for defined benefit pension plans) and nondiscrimination tests that apply to all discretionary amendments. In addition, the amendments would have to be adopted by the end of the plan year in which they become operationally effective.

Guidance for Health and Welfare Plans

Notice 2015-86 confirms that Federal tax law generally does not require health and welfare plans to offer any specific rights or benefits to a participant’s spouse. For plans that do offer spousal coverage, however, the Obergefell decision may require the plan to recognize additional same-sex marriages and to extend coverage to additional spouses.

If a “cafeteria plan” under Section 125 of the Internal Revenue Code did not permit coverage of same-sex spouses as of the beginning of the plan year, and the plan is changed during the year to permit such coverage, Notice 2015-86 provides guidance on how the plan can permit a participant to revoke an existing election and submit a new election. Specifically, if the plan already permits election changes due to a “significant improvement in coverage” during the coverage period, then the plan can simply rely on that provision to permit a participant with a same-sex spouse to make an election change. If the plan does not currently permit election changes due to a “significant improvement in coverage,” the Notice confirms that the sponsor can amend the plan to permit such changes. To be effective to permit an election change during the plan year in which same-sex spouses first become eligible for coverage, the amendment would have to be adopted by the last day of the plan year that includes the later of the date such coverage becomes available or December 9, 2015.

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.

© Pillsbury Winthrop Shaw Pittman LLP | Attorney Advertising

Written by:

Pillsbury Winthrop Shaw Pittman LLP

Pillsbury Winthrop Shaw Pittman LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.