Last week, the Internal Revenue Service (IRS) issued Notice 2015-86, providing guidance on the application of the U.S. Supreme Court’s decision in Obergefell v. Hodges to qualified retirement plans and health and welfare plans, including cafeteria plans. Importantly, and as expected, the IRS comments in the Notice that it does not anticipate that Obergefell will have a significant impact on the application of federal tax law to employee benefit plans.
Same-sex Spouse
DOL Proposes Change to FMLA Definition of Spouse to Accommodate Same-Sex Marriage
By Roberta Chevlowe on
As was expected, the U.S. Department of Labor has issued a proposed regulation changing the definition of “spouse” for FMLA purposes in order to protect the FMLA rights of employees with same-sex spouses.
The proposed regulation adopts a “place of celebration” rule, consistent with the current DOL interpretation in the context of other federal laws.…
Despite Windsor, Federal Court Rejects Challenge to a Self-Insured ERISA Health Plan’s Denial of Coverage for Same-Sex Spouses
By Joseph Clark & Roberta Chevlowe on
Following the U.S. Supreme Court’s decision in US v. Windsor, the requirement that an ERISA health plan provide health coverage for same-sex spouses has often hinged on whether an employee benefit plan was insured or self-insured and, in the case of insured plans, the requirements of state insurance law. In states where same-sex marriage…
New IRS Guidance Relating to Same-Sex Spouses and Qualified Retirement Plan Benefits
By Roberta Chevlowe on
Shortly after the U.S. Supreme Court ruled (in U.S. v. Windsor) that Section 3 of the federal Defense of Marriage Act (DOMA) was unconstitutional, the IRS announced that same-sex marriages will be recognized for federal tax purposes and provided guidance relating to the impact of Windsor on certain types of employee benefits. At the same time, the IRS left a number of issues open for future guidance for qualified retirement plans.
Last week, the IRS issued Notice 2014-19, clarifying the application of Windsor to qualified retirement plans. This guidance specifically addresses issues concerning the effective date and retroactive effect of the decision as well as the timing of relevant plan amendments. The IRS also published six Frequently Asked Questions (FAQs) that address details such as beneficiary designations in profit-sharing plans, the applicability of choice of law provisions in qualified plans, the application of Windsor to Code Section 403(b) plans, and additional guidance relating to plan amendments.