Interview: Same-sex divorces are a tiny but growing part of New Hampshire

I had the pleasure of being interviewed by David Brooks of the Nashua Telegraph for the article Same-sex divorces are a tiny but growing part of New Hampshire. As I observed, the reasons in a gay or lesbian divorce, and the emotions that come with it, are no different than any opposite-sex divorce. The differences come from the legal issues created by DOMA and other states who fail to recognize same-sex marriage. 

I learned something new from David, who was the first person to obtain same-sex divorce statistics from the State of New Hampshire. By the numbers:

Marriages                          Divorces

Female couples                                     1,628                                  61

Male couples                                           623                                     23 

Opposite-sex couples                            26,718                              15,222

The article also includes an interesting side note about the male/female ratios of marriages and divorces in New Hampshire same-sex couples. 

As of last month , New Hampshire has seen 1,628 female couples get married, which is 2½ times as many as the 623 male couples who have gotten married.

Over that same period, 61 female couples have gotten divorced, separated or had their marriage annulled – also 2½ times the figure for males, 23.

A part of our discussion that did not make it into the article was David's question about whether my practice was devoted solely to these gay and lesbian divorce and parenting matters. While it is an interesting area of the law that I enjoy practicing in, my hope is that DOMA will soon be overturned and there won't be any difference in the near future. Although I currently handle a large number of same-sex cases, it would be silly to exclusively devote to a law practice to an area of the law that will eventually no longer exist when marriage equality is achieved. 

 

New Hampshire same-sex divorce: What you need to know

Please check out my recent You Tube video on the topic of same-sex divorce in New Hampshire. We'll review length of marriage considerations, parenting rights for same-sex couples, and special property distribution issues in divorces for same-sex partners.

Understanding Same-Sex Divorce

In November, I authored an article on same-sex marriages in the New Hampshire Bar News geared towards helping practioners understand unique issues in same-sex divorces. I reprint here the full article:

Practicing family law in one of the six states that recognizes same-sex marriage requires an understanding of the unique challenges that same-sex couples face in a divorce. Usually, a divorce provides a mechanism to dissolve the legal relationship, divide property and establish parental rights and responsibilities. Although same-sex couples can dissolve their marriage in New Hampshire, reaching a fair and reasonable property division or establishing parental rights and responsibilities is much more difficult.

Marriage & Divorce

New Hampshire practitioners have limited precedent to guide them on several thorny issues that are distinctive to same-sex couples. Ironically, one of the few cases involving same-sex relationships, which is still good law, is now inconsistent with the state’s recognition of same-sex marriage. In the Matter of Blanchflower held that adultery does not include homosexual relationships. The court based its decision on the definition in New Hampshire of adultery, which excludes all non-coital sex acts, no matter the gender of the persons engaging in the act. Thus, although other fault grounds may be pursued, adultery is off the table for same-sex divorcing couples. The Blanchflower Court noted that it was not the function of the judiciary to extend past legislation to provide for present needs.

A common dispute in same-sex divorce is the calculation of the length of the marriage. In cases where the parties’ cohabitated long term prior to the marriage, one party may attempt to tack on the cohabitation to increase the length of the marriage and impact alimony and property division. This argument stems from the claim that had the parties been able to marry, they would have. Without New Hampshire precedent, the court may look to Massachusetts for guidance, where the Massachusetts Supreme Judicial Court has held that marriage benefits apply prospectively to the legalization of same-sex marriage. In addition to the cohabitation argument, the question also remains whether domestic partnerships, like those in California or New Jersey, might be similar enough to a marriage to tack on and create a long-term marriage.

Alimony

The IRS identifies alimony as payments made between spouses or former spouses pursuant to a divorce or separation agreement. Typically, alimony is deductible to the payor and includable as income to the payee for federal income tax purposes. However, the Defense of Marriage Act prohibits the federal recognition of same-sex marriages, and in turn precludes the IRS from recognizing a same-sex spouse as such. Although the IRS has not provided specific guidance on the issue, it seems clear that alimony payments are not tax deductible to the payor and may incur a gift tax liability. The IRS might alternatively consider the payments compensation for past services, with income tax, self-employment tax and possible withholding obligations. Either treatment will incur tax consequences that could be financially devastating to the family.

Property Division

In "traditional" divorces, opposite-sex couples rarely invokes tax consequences during the division of their marital assets. Such property transfers meet specific IRS exemption rules. Same-sex couples on the other hand can be saddled with a large tax liability as a result of property division.

The Defense of Marriage Act disqualifies same-sex spouses from the tax exemptions for property transfers made pursuant to a divorce decree. Instead, same-sex couples incur a gift tax liability for most transfers made between the spouses or former spouses in excess of $13,000. For example, if one spouse transfers $30,000 to the other spouse for property settlement, $17,000 would be taxable. In addition to gift tax, same-sex couples must be aware of capital gains tax when the home is transferred from joint ownership to one spouse.

A specific part of property division is the ability of a spouse to transfer property to a spouse or former spouse by qualified domestic relations order (QDRO) pursuant to the federal Employment Retirement Income Security Act (ERISA), a portion of a retirement plan or tax sheltered annuity. The tax treatment of such transfers depends on the word "spouse." In other words, in order to qualify for the tax-free transfer benefits, the relationship must be recognized by the IRS as a marriage. Under the Defense of Marriage Act, which defines marriage as between a man and a woman, a QDRO is not a vehicle available to same-sex couples to transfer retirement assets tax-free. Instead, same-sex couples must pay taxes and early withdrawal penalties on transfers made to the other spouse, regardless of whether it is deposited into the other spouses’s retirement account.

Parental Rights & Responsibilities

New Hampshire follows the legal principal that a child born into a marriage is presumed to be the legal child of both spouses. This presumption of legitimacy may be attacked however, and if successful could drastically affect the non-biological parent’s right to seek parenting rights and responsibilities, including residential responsibilities. Although the step-parent statute might be a useful tool in this circumstance, the parenting rights accessed through this avenue could look much different than the rights of a legal parent. Co-parent adoption is the safest way to establish protected parenting rights for each spouse.