In June 2013, the U.S. Supreme Court held in United States v. Windsor (570 U.S. __ (2013)) that section 3 of the Defense of Marriage Act (DOMA) was unconstitutional as a violation of the Fifth Amendment. Under DOMA, all references in the Internal Revenue Code and other federal laws to terms relating to marital relationships were required to be interpreted as relating only to marriages between a man and a woman. Service Revenue Ruling 2013-17 and two sets of Frequently Asked Questions issued in August 2013 helped to clarify Windsor’s effects on federal tax law, but additional guidance is still needed.
DOMA and Windsor. DOMA section 2 provides that no state must recognize a same-sex marriage entered into in another state or any right or claim arising from such a marriage. DOMA section 3 requires federal laws and agency rulings, regulations, and interpretations to define the words marriage and spouse as referring only to marriages between a man and a woman.
New York State residents Edith Windsor and Thea Spyer married in Canada in 2007; when Spyer died in 2009, she left her entire estate to Windsor. Because DOMA section 3 denied federal recognition of her marriage, Windsor did not qualify for the federal estate tax exemption for surviving spouses under section 2056(a). Windsor paid $363,053 in estate taxes and sought a refund, which the Service denied. Windsor sued for a refund in the U.S. District Court for the Southern District of New York, which ruled against the United States, finding section 3 unconstitutional. The Court of Appeals for the Second Circuit affirmed that judgment.