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The Constitution Outside the Courts: The Internal Revenue Service

September 18, 2013 by Lyle Denniston


Image source: 401(K) 2013/Flickr.
Image source: 401(K) 2013/Flickr.

Many Americans, not just the courts, help shape the meaning of the Constitution in the nation’s life. This series explains the actual or potential contributions of these other individuals, groups, or institutions. Today’s Constitution-maker is the Internal Revenue Service. As of yesterday, the IRS began enforcing new rules that provide significant federal tax benefits to legally married same-sex couples, doing so to avert new constitutional problems.

From the beginning of the national conversation about same-sex marriage, in the early 1990s, a constitutional question has persisted: if any state recognized such marriages, would the others have to respect that? It was an issue that the Supreme Court did not decide in June, when it struck down a key provision of the federal Defense of Marriage Act.

The Constitution’s Full Faith and Credit Clause, in Article IV, of course, does require the states to honor “the public acts, records and judicial proceedings of every other state.” But does a marriage decree qualify for that kind of respect? It probably does not, for two reasons. First,  the Supreme Court for decades has interpreted the clause to require respect for court orders, not other forms of state government action, and marriage decrees are technically not court documents. Second, the court also for a long time has said that there is an exception to the requirement when a state has a “public policy” that forbids it to respect another state’s action in a given area.

If those two reasons were not enough to deny marriage decrees in one state from recognition in another, Congress has given states explicit permission to refuse to recognize same-sex marriages performed in other states.

That is a provision of the Defense of Marriage Act—Section 2—that was not under review before the Supreme Court this year.  Section 2 reads: “No State, territory, or possession of the United States, or Indian tribe, shall be required to give effect to any public act, record, or judicial proceeding of any other State, territory, possession, or tribe respecting a relationship between persons of the same sex that is treated as a marriage under the laws of such other State, territory, possession, or tribe, or a right or claim arising from such relationship.”

What the Supreme Court struck down in June was Section 3, defining marriage for all programs and activities in the federal government as a marriage of a man and a woman.

Some legal observers believe that the nullification of Section 3 suggests that Section 2 might be vulnerable under the same constitutional guarantee of equality that led to the Supreme Court ruling. And a federal judge in Ohio has already ruled that way, at least temporarily, for a gay couple legally married in Maryland and seeking to have the marriage respected in Ohio, at least for some state-provided benefits.

This issue is likely to be sorted out in the courts in coming months and years. But in the meantime, the Internal Revenue Service has used its own authority to interpret the federal tax laws to take a major step toward nationalizing the right of married same-sex couples to equal access to federal tax benefits, even if they move into a state that formally refuses to recognize their marriage.

In what is called a “revenue ruling,” which just went into effect on Monday, the IRS gave such couples the right to federal tax equality, so long as their marriage was valid in any state. The ruling, the IRS noted, “applies to all federal tax provisions where marriage is a factor, including filing status, claiming personal and dependency exemptions, taking the standard deduction, employee benefits, contributing to an IRA and obtaining the earned income tax credit or child tax credit.”

The ruling, the IRS stressed, “applies regardless of whether the couple lives in a jurisdiction that recognizes same-sex marriage or  jurisdiction that does not recognize same-sex marriage.” The tax rights for such couples, the agency added, are based upon the validity of the marriage where it was performed, not whether there is a right to marry where the couple currently lives.

This is a form of Constitution-making by a federal agency since the IRS did not wait for the courts to widen the scope of marriage equality before the agency chose to do so using its own administrative powers. The tax equality its ruling decreed, the IRS said in explaining why it acted, is necessary to avoid the constitutional problem that would arise if same-sex marriages were treated differently based solely on sexual orientation.

So, at least for federal tax purposes, the Full Faith and Credit Clause would appear to have a new, more expansive interpretation, so far as marriage equality is concerned.

Lyle Denniston is the National Constitution Center’s adviser on constitutional literacy. He has reported on the Supreme Court for 55 years, currently covering it for SCOTUSblog, an online clearinghouse of information about the Supreme Court’s work.

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