Created As A Compromise, Rhode Island Civil Unions Law Continues To Disappoint, Failing To Deliver Promised Tax Exemption For Gay Couples

Susan Gershkoff, a Lincoln lawyer specializing in estate planning, thought that Rhode Island’s recently passed civil-union law would allow her gay clients to take advantage of a significant benefit that married couples receive: an exemption from the Rhode Island estate tax. But, as The Providence Journal reports, she was wrong. The reason is that the tax — currently applicable when an estate exceeds $859,350, but not when an estate is passed on to a surviving spouse –– is closely tied to federal law. And federal law is subject to the Defense of Marriage Act, in which the federal government defines marriage as a legal union between one man and one woman. As David Sullivan, state tax administrator, explains: “The starting point for personal income tax is Federal Adjusted Gross Income. … [T]he calculation of these items are based on federal tax laws.” Gershkoff was shocked. “When I read the civil-union statute over the summer, [I thought,] obviously, this unlimited marital deduction would extend to civilly unionized couples,” she said. Gay-rights advocates are similarly surprised. Karen L. Loewy, a lawyer for the Gay & Lesbian Advocates and Defenders, said her Boston-based organization had the impression, based on early discussions with Governor Chafee’s administration, that the new law would be interpreted by state officials in a “broad way,” adding that “If you look at the plain terms of the civil-unions law, it says that any time there is a term in Rhode Island law that invokes marriage –– whether it’s husband or wife or spouse or next of kin or widow or widower — those protections are supposed to go to couples in a civil union, too. That’s what the meaning of the civil-union law is. And if the state is interpreting their own programs in a different way, that is really troubling. Either the legislature meant to treat same-sex couples the same or they didn’t.” Loewy and other advocates say they are concerned that the administration’s position on the so-called “unlimited marital deduction” to the estate tax is a harbinger of problems ahead for Rhode Island’s new civil-union law, which took effect July 2. State Rep. Frank Ferri, a Warwick Democrat who married his gay partner in Canada, said Gershkoff’s concerns bring into focus another concern for gay couples: how will the state treat gay marriages from other states, territories, or countries? According to Ferri, the civil-union law only recognizes other civil unions, not gay marriages. Previously, state law had essentially recognized gay marriages from outside the state, he said. “We’re trying to get a clear read on this, and it’s not quite clear. We’re in limbo,” Ferri said. “We want to make sure our assets are protected in case something happens to one of us, and we’re not sure what status we are in with this civil-union bill.” Ray Sullivan, campaign director for Marriage Equality Rhode Island, a gay-rights group, seconded Ferri’s concerns. “The civil-union law doesn’t say anything about how marriages are going to be treated,” he said. “So, theoretically, it should be that things continue as they were before, which is inconsistent, at best.” Sullivan said the concerns only reinforce the need for passage of a gay-marriage law, something his organization lobbied hard for this year. “Every reasonable question that is raised about this flawed civil-union law furthers our argument of the immediate need to pass marriage equality,” he said. “This law provides confusion, not equality.” Passed by the state legislature and signed into law by Chafee over the summer, Rhode Island’s civil-union law ––House Bill 6103 A –– was supposed to give gay couples access to hundreds of legal rights, benefits and obligations previously reserved for married heterosexual couples. House Speaker Gordon D. Fox says the law does just that. An openly gay Providence Democrat, Fox threw his support to the civil-union bill after he failed to garner enough support for a proposal to allow gay couples to marry. Through a spokesman, Fox said the new law gives same-sex couples the right to take a leave from work when a partner gets sick. It provides a surviving partner with a portion of the inheritance if the deceased partner dies without a will. And it gives partners in a civil union the same hospital visitation rights as family members, as well as the authority to act for a sick partner, if necessary. “The committed couples who have entered into civil unions during the past few months have certainly benefited from its passage,” Fox said in a statement. Fox said his office has not been contacted about problems with the new law, but Ferri said he would bring Gershkoff’s concerns to the speaker soon. In the meantime, Loewy argues that the state should be finding “work-arounds” to the federal Defense of Marriage Act, as other states with civil-union or gay-marriage laws have. In Massachusetts, for example, where gay marriage is legal, gay couples file federal income tax forms as individuals, but file jointly for their state tax returns, Loewy said.“Overall, any reading of Rhode Island law needs to be finding solutions, rather than obstacles,” she said. “It has to be finding a route for couples in a civil union to be treated equally by their state. That is the whole purpose of the civil-union law.”