July 19, 2019

Last month, the House Ways and Means Committee unanimously approved a bill to allow same-sex couples who married before the overturn of the Defense of Marriage Act (DOMA) to amend their filing status and claim their tax refunds as jointly-filed spouses. If enacted, this bill would be a huge step for the government because it would make an exception to the three-year statute of limitation rule for taxpayers to claim their refunds.

The purpose of H.R. 3299, or the Promoting Respect for Individuals’ Dignity and Equality (PRIDE) Act of 2019, is to permit legally married same-sex couples to amend their filing status for income tax returns outside the statute of limitations and to amend the Internal Revenue Code of 1986 to clarify that all provisions shall apply to legally married same-sex couples in the same manner as other married couples. It incorporates language from H.R. 3294, the Refund Equality Act, and H.R. 1244, the Equal Dignity for Married Taxpayers Act. This bill would provide same-sex couples, who married before the Supreme Court’s decision in U.S. v. Windsor, an opportunity to claim their tax refunds and would remove gendered language such as “husband” and “wife” from the Internal Revenue Code to accommodate same-sex married couples.

Prior to the Windsor decision, federal law defined marriage for federal purposes as the union of one man and one woman, and allowed states to refuse to recognize same-sex marriages granted under the laws of other states. DOMA barred same-sex married couples from being recognized as “spouses” for purposes of federal laws, effectively barring them from receiving federal marriage benefits such as the filing of joint tax returns and federal refunds from those joint returns. Although the Supreme Court declared section 3 of DOMA unconstitutional under the Due Process Clause of the Fifth Amendment, the IRS lacks the authority to override the three-year limitation on which a claim for refund can be made.

Generally, under section 6511(a) of the Internal Revenue Code, a claim for credit or refund of an over-payment of any tax needs to be filed by the taxpayer within three years from the time the return was filed or two years from the time the tax was paid, whichever period expires later. If enacted, the PRIDE Act would allow same-sex married couples to amend their separately filed returns prior to the overturn of DOMA and claim their refunds under jointly filed tax returns. The IRS would most likely have to adjust some procedures and forms upon the passage of this bill due to the exception of the three-year limitation on the claim for refund. In light of the tax law changes implemented by the Tax Cut and Jobs Act, this bill would be a welcome change for same-sex married couples if they are entitled to any tax refunds as joint-filing spouses.

If you would like more information regarding the tax benefits of the PRIDE Act or interested in filing amended tax returns, then contact Enterprise Consultants Group’s tax advisors. We can be contacted online or at (800) 575-9284 to discuss your specific needs.