The McDonnell administration has doubled down on its antipathy toward LGBT Virginians (with the Family Foundation claiming credit in an email blast). The Virginia Department of Taxation has announced a new state policy that discriminates against married same-sex couples by denying their ability to file joint state tax returns. To make matters worse, the new policy also imposes additional paperwork and accounting requirements on Virginia businesses. Whether you’re a supporter of equality, a supporter of business, or both, the solution is clear: This new policy has got to go.
Instead of embracing the U.S. Supreme Court decision that found the federal Defense of Marriage Act unconstitutional, Virginia has signaled its continued opposition to basic fairness by singling out married same-sex couples for discriminatory treatment under state tax laws. The tax department’s ruling is inconsistent with federal income tax laws and is in conflict with the state law that requires conformity with federal rules. As a result, married same-sex couples in Virginia can file joint tax returns at the federal level, but will have to file as single or head-of-household at the state level. Moreover, under the announced policy, the married couple will have to recalculate their individual adjusted gross incomes to add back to their incomes any amounts legally deducted under federal law.
Virginia businesses also will suffer. Under the new policy, Virginia businesses that utilize the federal tax deduction that allows employers to claim a federal tax deduction for fringe benefits offered to employees’ spouses and dependents must adjust their state tax filings to reflect the commonwealth’s refusal to recognize married same-sex couples. No other state has imposed such requirements on businesses. It appears that the intended effect is to discourage businesses from offering such benefits by making their administration particularly onerous.
It is shameful that Virginia continues to deny equality to, and impose discriminatory policies on, LGBT Virginians. And, in these harsh economic times, it is outrageous that an administration that claims that Virginia is good for business has decided to impose new paperwork and accounting requirements on Virginia businesses, and particularly on struggling small businesses.
Instead of focusing on discrimination, Gov. McDonnell should have taken a lesson from his counterpart in Missouri.
Like Virginia, the Missouri constitution recognizes only marriages between men and women. Yet Missouri’s governor, Jay Nixon, took the polar opposite approach to addressing the rights of legally married couples under state tax policy. Nixon issued an executive order directing the state’s tax department to accept joint returns from married same-sex couples. This common-sense, inclusive response should serve as a model for all states that currently deny marriage equality.
Unfortunately, the McDonnell administration again chose to embrace the discriminatory option. Its new rule has helped Virginia solidify its disgraceful standing as a national leader in hostility toward LGBT residents. While the federal lawsuit (Harris v. McDonnell) that the ACLU and Lambda Legal filed to bring marriage equality to Virginia ultimately will compel the commonwealth to end its discriminatory treatment of same-sex couples, neither Virginia residents nor Virginia businesses should have to wait for the federal courts to act to assure them fair treatment under the law.
Claire Guthrie Gastañaga is executive director of the ACLU of Virginia. Contact her at email@example.com.
a supporter of equality, a supporter of business, or both, the solution is clear: This new policy
has got to go.