Same-sex couples wedded in states that allow gay marriage could find an obstacle when they try to file their South Carolina income-tax returns.
The Internal Revenue Service will allow same-sex married couples to file their federal income taxes jointly even in states, like South Carolina, that ban gay marriage.
But the S.C. Department of Revenue proposes requiring those couples to file separately, a proposal the state agency now is seeking comments on. Same-sex married couples would have to complete another set of individual federal tax forms as single filers to use in calculating their South Carolina income tax returns, the department said.
An accountant said the rule should not cost same-sex married couples more money on their taxes. But they will spend extra time completing their tax returns or pay more for tax preparation, gay rights advocates said. Same-sex couples who file their federal taxes electronically also would have to file their state returns on paper, delaying refunds that arrive faster when returns are filed electronically.
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“It is really hard to tell same-sex couples that, ‘You are legally married, but the state of South Carolina says you’re roommates,’ ” said Ryan Wilson, executive director of South Carolina Equality. “It’s a disservice to these individuals to not get that recognition from the state.”
Same-sex marriage is legal in 16 states and the District of Columbia.
The IRS issued its rule after the U.S. Supreme Court shot down provisions of the federal anti-gay marriage law, known as the Defense of Marriage Act. But the court’s ruling did not change state laws.
At least one state that bans same-sex marriages, Missouri, is allowing gay couples wedded in other states to file jointly on their state tax returns.
S.C. government leaders, including Republican Gov. Nikki Haley, have fought against recognizing gay marriage. Voters overwhelmingly agreed to amend the S.C. Constitution in 2006 to ban same-sex weddings.
The Revenue Department said no one requested the agency issue the ruling. The agency said it is following the state Constitution.
“Consistent with South Carolina law, the department will continue to interpret the terms ‘husband’ and ‘wife’ as gender specific, and ‘spouse’ as referring to a person of the opposite sex for South Carolina tax purposes,” the draft rule says.
Comments and suggestions will be accepted until next Friday.
The Revenue Department does not have a timetable for the rule’s adoption. The agency “will make all efforts to issue the policy document as timely as possible after any needed revisions have been made and approved,” spokeswoman Samantha Cheek said.
If the tax rule passes, a legal challenge could be filed, said Malissa Burnette, a Columbia attorney who heads South Carolina Equality’s task force on litigation.
“This is a waste of government money,” she said. “They’re going to have to handle more returns now.”
Preventing same-sex couples from filing joint state returns sends a poor message from the Haley administration to economic-development prospects, said Wilson, head of South Carolina Equality. Job creation is a key issue in the governor’s re-election bid later this year.
A Boeing employee from Washington state, which allows gay marriages and where the aircraft maker has much of its operations, might not want to transfer to the company’s North Charleston plant, Wilson said.
“These folks are taking a risk with businesses,” he said.
Haley’s office did not respond to requests for comment Friday.\
Read the rule and comment
To see South Carolina’s proposed rules on state income-tax filing for same-sex married couples and comment, go to http://www.sctax.org/Tax+Policy/ Policy/policylist2.htm.