IRS: Marietta must provide benefits to same-sex couples
by Hilary Butschek
August 26, 2014 04:00 AM | 3678 views | 2 2 comments | 6 6 recommendations | email to a friend | print
Marietta Mayor Steve Tumlin
Marietta Mayor Steve Tumlin
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MARIETTA — Even though Georgia doesn’t allow gay marriage, the city of Marietta will be forced by the federal government to recognize same-sex couples as married partners when handing out retirement benefits.

A new Internal Revenue Service mandate that applies to the city resulted from the Supreme Court ruling in United States v. Windsor, which overturned the Defense of Marriage Act stating marriage is between a man and a woman. The mandate requires all retirement plans recognize samesex couples if they were married in a state that has legalized gay marriage.

If the city does not comply with the mandate from the IRS, it will be in violation of federal law, said Amy Henderson, spokeswoman for the Georgia Municipal Association.

Henderson said the city of Marietta needs to revise its definition of the word spouse to comply with the law.

Now, the change to the retirement plan is being suggested to the Marietta City Council to consider at its personnel and insurance committee meeting Wednesday.

Henderson said the mandate implies if a woman working at City Hall is setting aside money in a retirement fund but suddenly dies, she can leave the money in the fund to her female partner if the two were legally married in a state allowing same-sex marriage.

When same-sex couples receive benefits

Henderson said the key to determining if the city needs to recognize a same-sex couple as legally married is asking if federal taxes are involved.

“Where there is a federal tax implication, (the IRS) says it follows the Windsor law as to how the IRS defines marriage, meaning it does not always have to be between a man and a woman,” Henderson said.

Henderson said retirement fund payments subject to federal taxes can go to a married samesex partner because of the mandate. Partners connected in a civil union or domestic partnership do not have to be recognized as married, Henderson said.

“Say there’s a payment that’s being made to a spouse that has taxes on it,”Henderson said. “That can now go to someone who is in a same-sex marriage.”

Henderson said the retirement system, which is heavily regulated by the federal government, has always worked the same way. With this update, nothing about the way a retirement plan rolls out will change, she said.

“Say an employee has been making contributions to their retirement and they die, that money has to be returned. Typically, it’s going to be returned to the spouse, or if there is no spouse, to the estate of the deceased,” Henderson said. “What’s changing now is the definition of the word spouse.”

The GMA handles the retirement payout plans for 282 of the 521 cities in Georgia that are members of the organization, said Lamar Norton, executive director of the GMA.

“We handle them administratively,” Norton said. “They send their contributions to us, we invest them in lump sum. Then we write the checks to the individual retirees.”

The GMA changed its retirement policy in September 2013 to include a second definition of the word spouse that includes those legally married to a partner of the same sex, but only in cases where federal taxes are involved.

Shannon Barrett, the city’s acting human resources director, said the change to the policy will not affect the way the city gives out its retirement benefits, just who the money goes to in certain cases.

“The state of Georgia still does not recognize same-sex marriage, but the IRS, for their purposes, does,” Barrett said. “We’re really just adding in a second definition of spouse. It doesn’t change anything with our plans.”

Reaction from council

Mayor Steve Tumlin would not give his opinion on same-sex marriage, and he said the change the council plans to make to its retirement policy is mandated, not done by choice.

“I’m for following the law,” Tumlin said. “It’s a have-to — it’s not a preference. This change is the pure legalese from the ramifications of the Windsor case.”

Tumlin said he won’t suggest allowing same-sex couples to receive other benefits until the state or federal government mandates it.

“Our rates — and everything else — are based on the traditional marriage and traditional children,” Tumlin said. “The full change won’t come until the state changes. To get into a judgment that goes beyond Georgia law, I just have no comment from there.”

Councilwoman Michelle Cooper Kelly said she agrees with the mayor it is not the time for the council to discuss changes to other employee benefits, such as health insurance, to include same-sex couples.

“It’s kind of hard to speak on it when it’s not before the council. I have no comment at this time, just because that’s so broad and general. I don’t know what they’re (same-sex couples) asking for,” Kelly said. “I think about all the benefits that my husband and I are privy to, and I’d really like to know more about what they’re asking for.”

Councilman Johnny Walker said he doesn’t support same-sex marriage, but his promise to abide by the law trumps that belief.

“My personal Christian belief is that the term ‘marriage’ is between a man and a woman. If the laws were changed in the future to provide benefits for same-sex couples, I would abide by them as I do now,” Walker said.

Councilman Andy Morris said he also does not favor same-sex marriage, but he isn’t opposed to changing the city’s retirement policy.

“I’m a good Methodist, and I believe a marriage is between a woman and a man,” Morris said. “I think we need to talk about what our department is recommending.”

Councilman Philip Goldstein would not share his opinion on the issue of same-sex marriage because he said it didn’t relate to the mandate.

“It is a simple issue of complying with the law to bring the city’s plan in conformance with IRS regulations as to coverage of a spouse,” Goldstein said.

Councilman Grif Chalfant said the city doesn’t have much of a choice in changing the policy.

“It’s really out of the city of Marietta’s authority,” Chalfant said. “I think it’s the right thing for us to do is follow the federal guidelines, but I don’t agree with everything the federal government does.”

Council members Anthony Coleman and Stuart Fleming did not respond by press time.

Comments
(2)
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anonymous
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August 26, 2014
Good Methodist Morris should know all about marriage. He's had enough of them!!!
Lib in Cobb
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August 26, 2014
OK whistlenuts, time to come out of your shoes.
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