State Assemblyman Phil Ting announced legislation today that would provide tax relief for people in same-sex relationships who receive health care benefits from their partner.
Currently, health benefits in same-sex partnerships are taxed by the federal government as income, although some California companies reimburse that tax to their employees.
However, the state then taxes that reimbursement, an average of about $540 annually that opposite-sex families do not have to pay.
Assembly Bill 362, authored by Ting, D-San Francisco, would exempt same-sex couples from paying that reimbursement tax.
“We want to close that loophole,” he said, adding that he will “continue to fight for greater fairness and equity in California.”
California companies that offer the federal tax reimbursements include Facebook and Google, while Cambridge, Mass., also reimburses its city employees.
Ting said nearly 20,000 people in the state could potentially be affected by the legislation.
Alice Kessler, director of government affairs for the gay rights group Equality California that supports the legislation, said gay and lesbian couples “work hard, they contribute to society … yet still experience these inequities.”
Kessler said, “It’s something I feel I shouldn’t have to suffer simply because of who I love.”
San Francisco Supervisor Mark Farrell has introduced an ordinance to reimburse city employees for the federal tax. That legislation was passed by the board’s budget and finance committee and will be in front of the full board for approval at its Feb. 26 meeting.
“At the local or state level, we can’t stand idly by,” Farrell said.
He said he is hopeful that the U.S. Supreme Court overturns the federal Defense of Marriage Act, which prohibits recognition of same-sex partnerships, when it takes up the issue of gay marriage in March.
The court will also hear arguments on a related case, California’s Proposition 8, and is expected to issue a ruling by the end of June.
Dan McMenamin, Bay City News