As same-sex marriage becomes legal in New York — a world financial capital that often sets the corporate tone for businesses everywhere, and a city with a large gay and lesbian community — companies and individuals are wrestling with the changing complexities of their financial realities.
For straight couples, the choice has generally been to marry or not to marry, period. But conflicting state and federal marriage laws and questions about corporate benefits policies make financial planning decisions much less cut-and-dried for many gay couples.
Jason Ganns, an accountant from Albany, figures getting married to his same-sex partner will save him $350 to $450 a year in state income taxes — after a devil of a time reconciling those forms with his federal return, on which he won't be considered married.
New York City resident Andrew Troup and his partner have kept their health insurance policies separate because of tax complications and are now weighing whether merging them will make sense after marriage.
And if they've been waffling on marriage, some couples may now have to decide whether to take the plunge if their employers now restrict domestic partner benefits to the lawfully hitched.
"There's just a lot of rumors going around," said Erica Freudenstein, a 46-year-old freelance photographer from New York City who plans to wed her longtime partner, television video editor Cybele Policastro. Freudenstein has been covered under Policastro's health insurance.
"She has to pay taxes on it for my health insurance, and now for New York state I think she won't," she said. "So it's a benefit. It's all about the benefits."
New York is home to an estimated 42,600 same-sex couples, many already considered married in Canada and other places that allow gay marriage but are less business-heavy, including Iowa, Connecticut, New Hampshire, Vermont, Massachusetts and Washington, D.C.
The range of newly available benefits for New York's married gay couples will span from cradle to grave, affecting rights on everything from adoption to the settling of estates. But taxes and health care benefits are the dollar-and-cents issues in the forefront for many couples.
It is estimated that thousands of gay people in New York are covered under their partners' employer-provided health care plan. Married couples are not taxed on the value of an employer's contribution to cover their spouse, but it's been different for gay couples, even for New Yorkers who got legally married elsewhere.
Troup and his partner were married in Canada and have been recognized as such under New York law since 2009 — but they're not sure how their relationship status will change when New York on July 24 starts recognizing same-sex marriages performed in the state.
They work at different software companies and are weighing whether to merge their health insurance policies once they're married.
"We're going to have to sort of re-evaluate and decide whether it's more cost-effective to be under one plan or not," he said.
While marriage will afford gay couples some state tax benefits, federal taxes are still off the table because of the 15-year-old Defense of Marriage Act, under which federal law defines marriage as between a man and a woman and does not require states to recognize same-sex marriages performed outside its borders.
For Ganns and his husband-to-be, that means they can file jointly on their state returns but must file individually on the federal forms, which are typically used as the basis for state forms.
"Not only is that complicated, but our tax preparer will have to prepare a joint federal return to get certain numbers on that end up on that state joint return, and then throw federal return away because he can't file it anyway. ... It's going to cost most people more to get their taxes done," Ganns said.