Wealthiest Gay Americans Hardest Hit by Federal Tax Law

Lesbian and Gay Couples get hit hardest because they are not legally married.

A study released in late November reveals just how profoundly the lack of marriage parity affects American lesbian and gay couples. Because the U.S. federal government refuses to recognize same-sex marriage, lesbians and gay men are currently barred from passing on the bulk of their wealth to their partners and children after death. Just how much does this legal inequity affect gay and lesbian couples? Try $3.3 million dollars—the amount, on average, that the study estimates individual same-sex couples in the highest tax brackets lose per couple when compared with their similarly situated heterosexual socio-economic peers.
The study, “Federal Estate Tax Disadvantages for Same-Sex Couples,” was released by the Williams Institute at the UCLA School of Law and comes only a month after the organization released a report finding that the majority of same-sex couples have less retirement income than married different-sex couples. Both reports were conducted with funding from Merrill Lynch Global Wealth Management. The Institute’s findings regarding U.S. tax law and LGBT couple’s inequitable status under it are considered important by many LGBT activists because to date there exist very few distinct  measures charting the tangible effects of the lack of federal same-sex marriage rights on our community.