Loving Couples, Split Interests: A Call for Tax Planning in the Fight to Recognize Same Sex Marriage

Anthony A. Rickey

Abstract

A fundamental tension exists between the Defense of Marriage Act, which forbids the Internal Revenue Service and the federal judiciary from recognizing same-sex marriages, and the Internal Revenue Code, which uses marital status to identify parties likely to collude in order to minimize their collective tax burden. Homosexual couples married under state law are arguably exempt from anti-abuse rules promulgated over fifteen years ago to eliminate tax shelter strategies employed by heterosexual couples. This essay suggests that homosexual rights advocates can exploit this tension through the use of relatively simple tax planning devices, as part of a campaign to repeal the Defense of Marriage Act itself. Such a campaign would center upon legal challenges forcing the Service either officially to allow a “gay tax shelter” or, for the first time, to recognize same-sex relationships for the purpose of tax law.