Individual Health Insurance

Individual Health Insurance

Health Insurance Individual California

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Are there tax advantages to filing for a domestic partnership?

I am currently engaged and was wondering if there are tax advantages if the two of us filed for domestic partnership? I looked at the requirements and we meet all of them.

Different states have different rules:

Here for CA:

Effective January 1, 2002, several taxpayer benefits were extended to a taxpayer’s domestic partner and the domestic partner’s dependent(s) for medical expenses and health Insurance Benefits that occur on or after January 1, 2002. The benefits provided by Revenue and Taxation Code section 17021.7 include:

* An exclusion from gross income for employer-provided accident and Health Insurance.
* An exclusion from gross income for medical expense reimbursement if the expense was not previously deducted.
* Medical expenses deductible as an itemized deduction.
* Long-term Health Care Insurance deductible as a medical expense.
* A deduction by self-employed individuals for Health Insurance Costs. The deduction may not exceed the net earnings from the trade or business in which the insurance plan is established.

Federal tax law does not allow the same benefits for domestic partners. These deductions are taken as an adjustment on the Schedule CA(540) or Schedule CA(540NR).

In general, California now affords the same rights and responsibilities to RDPs that previously were available only to married individuals. For California tax purposes, the same rules applicable to married individuals (relating to filing status, community property income, etc.) now apply to RDPs. However, because the federal government does not recognize domestic partners as married individuals for federal tax (IRS) purposes, RDPs will continue to file as unmarried individuals on their federal returns.

Are all domestic partners required to file joint or married filing separate returns under the new law?

No, only domestic partners who are registered with the California Secretary of State are required to file using the married filing joint or married filing separate filing status. More information on unions entered into from other states will be provided on this Website in the near future.

When will registered domestic partners (RDPs) use the same filing status rules as married individuals when filing California returns?

The new law applies for RDPs filing their 2007 tax returns in 2008.

Can RDPs file a California tax return with the same filing status as they use on their federal return?

No, the new law requires RDPs to file a joint return using the married filing joint or married filing separate filing status. Federal law does not allow RDPs to file a joint return.

Medicare Supplement Insurance, Medicare Advantage, Individual & Family Health Insurance, Anaheim CA

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