The Dollar Cost of No Legal Marriage

Rich Linnell and Gary Chalmers say their battle for the right to marry is about fairness and money -- and the future of their 11-year-old daughter, Paige.

Linnell and Chalmers say they are reminded at every turn that their inability to marry takes a financial toll. For example, there’s the extra $3,600 Linnell pays each year because he cannot piggyback, as a spouse could, on the health insurance policy that Chalmers gets as a teacher.

“We have a college fund set aside for Paige,” said Chalmers, who earns about $60,000 a year, about the same as Linnell’s pay as a nurse. “I’d like to see that $3,600 going towards that fund.”

The Northbridge, Mass., couple, together for 15 years, are among the plaintiffs in a closely watched lawsuit that claims same-sex couples have the right to wed under the state constitution. Massachusetts’ highest court, the Supreme Judicial Court, is expected to rule on the case this year -- and, plaintiffs hope, make the state the first to permit gay marriage.

For many gay couples, the inability to marry adds up to real expenses, say lawyers and financial planners who specialize in advising nontraditional couples.

Some costs hit couples of any age. For instance, while some companies offer health benefits to their employees’ domestic partners, the partner must pay federal income taxes on the value of the benefit, which a spouse could receive tax-free.

Other costs occur later in life -- especially upon the death of one partner -- when pension benefits may be compromised, property transfers complicated, or 401(k) savings taxed years before they might be for a surviving spouse. And Social Security benefits, which in some cases can be tapped by a surviving spouse, are essentially untouchable by a surviving domestic partner.

“We’ve taken all those legal precautions we think we can take,” said Chalmers. “It seems like every day or every month, we find out there’s another piece we haven’t covered, where if we had the right to be civilly married in Massachusetts, all these things would be automatic.”

But Chalmers and Linnell also acknowledge a point made by financial planners -- financially, some gay couples are better off unmarried, having found ways to save themselves money. Planners emphasize that neither they nor the IRS necessarily condones such maneuvering, but they say some of these practices are common among gay couples:

* When one unmarried partner earns considerably more than the other, deductions and charitable contributions may be shifted to the higher earner’s tax return, where they do more to reduce the tax burden.

* When gay parents have two children, they may be able to double -- to $10,000 -- a deduction for child-care expenses simply by making each child the dependent of a different parent.

* If the poorer of two parents claims a child as a dependent, the richer parent may be invisible to college financial aid offices, which may result in a better deal.

“There are some interesting, aggressive ways to take advantage of not being married,” said Donna Turley, a Boston trust and estates lawyer who has taught financial planning workshops for same-sex couples. “But none of them is anything you’d be proud of. Part of it is, ‘If they won’t give us marriage, we’re going to use it creatively.’ Because we’re being denied something, we’re going to be aggressive about getting” other things.

Ronald Crews, president of the Massachusetts Family Institute, which opposes gay marriage, said he regretted the fact that some gay couples pay more because they can’t marry. But he said that was no excuse for changing the definition of the institution of marriage.

“In life we don’t get everything we want, and that’s because some things just mean what they mean and we have to accept the consequences for that,” Crews said.

Numerous states and the federal government have passed so-called defense of marriage acts, and a July poll by the Pew Research Center for the People & the Press reported that 53% of Americans opposed gay marriage, although that percentage was lower than reported in previous polls.

The Massachusetts case is attracting attention because some experts believe that if the case leads to the legalization of same-sex marriage, other states that oppose gay marriage could be forced to honor Massachusetts marriages under the “full faith and credit” clause of the U.S. Constitution.

Still, such a victory would be unlikely to transform the financial affairs of gay couples overnight. Most tax and many pension issues are governed by federal law, which includes a 1996 statute defining marriage as a “legal union between one man and one woman.”

Linnell and Chalmers say they are well aware that many gay couples might choose to remain unmarried -- for financial or other reasons. But they say they have a right to choose.