IRS Cracks Code for Same Sex Couples in WA, NV and CA - Better Get Aspirin

The IRS took same-sex couples in Washington, Nevada and California one step forward in our battle for equality, but made it as painful and confusing as possible.

According to the Wall Street Journal, last year a partnered/married California couple (again) asked the IRS how they should file their taxes.  DOMA prohibits them from filing jointly, but California is a community property state for same-sex couples (in essence, what's yours is mine when it comes to assets in a relationships).  The IRS responded that they should combine their tax information, divide by two, and submit two separate returns.  According to the San Diego Gay & Lesbian News, the IRS is making it mandatory for all same-sex California couples in 2010.

Though Washington and Nevada have received considerably less press coverage then California, they are also community property states with domestic partnership laws and according to Lambda Legal the same rules are being applied.  If you are in this group, is time to consult an accountant!

This is great news if you are a same sex couple in one of these states and each of you is in a different tax bracket (think highly overpaid teachers matched up with severely underpaid governors).  Your family's tax bill may actually go down!  And you may be able to refile taxes for up to three prior years.

Now the bad news. 

You most likely cannot file electronically. 
You most likely will be questioned by the IRS because your taxes do not match your W2s. 
You will have to write the IRS a check for one person's taxes while you wait for the refund to come from the other's. 
And if you and your partner are in the same tax bracket, you get absolutely no benefit, but do have the pleasure of now having extremely complicated taxes!

All we can do is hope that the President's decision not to support DOMA Section 3 will allow the IRS to simplify this process in the future.