|
Same-sex
pairs to benefit under
new pension law
Provision allows nonmarried
beneficiaries to postpone
taxes
Wyatt Buchanan, Chronicle
Staff Writer
Friday, August 18, 2006
Article appeared on page
A - 4 of the San Francisco
Chronicle
Same-sex couples will
be able to save on taxes
starting next year under
a massive overhaul of
U.S. pension rules signed
into law Thursday by President
Bush.
The law includes a provision
that will allow "nonspousal
beneficiaries," including
same-sex partners, to
roll over inherited retirement
plans if their partner
dies. That option, previously
available only to married
couples, can mean hundreds
of thousands of dollars
-- or maybe even more
-- in tax savings for
a beneficiary.
Bush called the Pension
Protection Act of 2006
"the most sweeping reform
of America's pension laws
in over 30 years."
The law, which allows
nonmarried beneficiaries
to roll over retirement
money into an IRA without
paying taxes until the
money is withdrawn, becomes
effective Jan. 1. It will
also benefit workers who
name relatives other than
spouses as beneficiaries.
Congress "was probably
not thinking that this
would be a big benefit
for the gay and lesbian
community, but the fact
of the matter is that
it is. It is one of the
greatest benefits of marriage
under the Internal Revenue
Code," said Teresa Renaker,
an Oakland attorney who
specializes in pension
and employee-benefits
litigation.
People who have already
designated a nonspousal
beneficiary in their retirement
plans will be covered
by the new law.
When Gerry Goeres' partner
died in 1999, Goeres had
to fight for 15 months
to get his partner's company
to recognize him as a
beneficiary. Then he had
to pay about half the
retirement savings --
nearly $250,000 -- in
taxes.
"I knew I would be hit
with taxes, yes. Did I
think they (would be)
what they were? No, because
I somehow thought I would
be able to roll it over
from one account to another,"
said Goeres, who is suing
his partner's employer
over the delay.
The signing of the bill
also marks the first benefit,
albeit tangential, for
gays and lesbians to be
passed by Congress in
more than a decade, said
Joe Solmonese, president
of the Human Rights Campaign,
a gay and lesbian rights
organization. It also
is the first change in
the tax code to help same-sex
couples, he said
The group has lobbied
members of Congress on
this issue for four years,
Solmonese said, and received
bipartisan support.
"We had some people who
were motivated to help
GLBT families, others
who were less motivated
to help our community.
But they all understood
the need to strengthen
families and that families
come in all shapes and
sizes," he said. |
