A few days ago I wrote about adding a new spouse to the title of your home after getting married, and a reader commented that he wondered if the tax benefits provided to same-sex registered domestic partners would be the same as the benefits for married partners. I’ve done some research into the and will preface this post with a big fat disclaimer: I’m not an attorney, I’m not a CPA, I’m not a tax advisor, and I don’t play any of these on TV. I’m summarizing what I’ve found and I’m encouraging anyone who needs advice on how to hold title to real property or how to file their taxes to consult their financial gurus. There. That’s out of the way. Now, on to what I’ve found out.
In a nutshell, in terms of owning property, the demise of Section 3 of DOMA (the Defense of Marriage Act, passed in 1996 and partially struck down by the Supreme Court in 2013) has now allowed same-sex married couples to enjoy the same benefits given to opposite-sex married couples. In California, both same-sex married couples and registered domestic partners can hold title as community property with the right of survivorship. Same-sex married couples also benefit from the other 1,137 protections and responsibilities granted to married couples from the federal government.
Our reader’s question was about domestic partnership vs. marriage. He asked: “is there any benefit or disadvantage from a real estate perspective to marrying vs. remaining in a domestic partnership? Doesn’t *seem* like there’s much tax difference between the two because of our robust DP benefits here in California.” My research didn’t produce any substantial real-estate-related differences; domestic partners can hold title as community property and thus receive the tax benefits associated with that method of holding title.
So, in California, if we look just at real estate, I didn’t find any major differences between same-sex marriages and registered domestic partnerships. If any readers know of anything that I didn’t discover in researching this topic, please let me know in the comments or via email. I’d be happy to post an update if I missed anything important.