Under current law, domestic partner benefits are treated as taxable income — a blatantly homophobic and discriminatory practice that exposes employees and the employer to higher tax liability.
Gay or lesbian employees with domestic partner benefits, on average paid $1,100 more in taxes than their straight coworker. Under the healthcare reform bill, such benefits are tax-free.
From personal experience regarding domestic partner benefits, I can report that adding Jim to my health plan, or Jim adding me to his health plan, exposes the other to roughly $5,000 a year in additional taxable income. Because of this, neither of us have added the other to our employer sponsored health plan. Over the years, I have written more than a dozen complaint letters to my Congressional representatives regarding this discriminatory practice.
In the words of Congressman Jim McDermott (D-WA):
“[The change] would correct a longstanding injustice, end a blatant inequity in the tax code and help make healthcare covergae more affordable for more Americans.”
I couldn’t agree more.