This is probably most evident in the health and pension area. Over the past decade a growing number of employers have begun making health benefits available to the domestic partners of their employees. Unlike most employee health coverage, however, workers are often required to pay income tax when the coverage is extended to an unmarried living partner. Being legally married would change this for gay couples, but only if the federal government recognizes the marriage. Under DOMA a couple could get married under their state s own laws but would have to continue paying tax on benefits that other couples enjoy tax-free.
Pensions are an even bigger problem.
In many households, especially for couples that have spend a long time together, one partner s pension, profit-sharing and IRA accounts may be the biggest single asset. Generally both partners count on this money for retirement security, though the accounts are in only one individual s name. In the event of divorce these accounts often need to be divided if any kind of equitable settlement is to be achieved. The tax code provides that under a Qualified Domestic Relations Order one divorcing spouse can transfer retirement plan benefits into the name of the other spouse without any tax effect. The retirement money remains tax sheltered until it is withdrawn.