The end of the Defense Of Marriage Act and the new federal recognition of same-sex couples will also mean great changes for LGBT taxpayers. NY1's Money Matters reporter Tara Lynn Wagner filed the following report.
When the U.S. Supreme Court struck down the Defense Of Marriage Act, the decision impacted more than 1,100 federal laws and a whole lot of bank accounts.
For one thing, Janis Cowhey McDonagh, a trust and estate partner at Marcum and a leader of the LGBT Practice, notes that a married same-sex couple will have a much easier time filing taxes.
"Up until now we had to file married returns in New York but single returns for the federal government. So you had to run two sets of tax returns at a single, at a married, then is it married separate, is it married joint? The choices were endless," McDonagh says.
It was also costly, since preparers generally charge for each of those different items. The ruling eliminates both the extra paperwork and cost associated with it.
"It's just a lot simpler. You get married, you file your taxes, you live your life and you don't have to worry about all this stuff," says Michael Vito, a partner in the trusts and estates practice group of Lowenstein Sandler.
McDonagh says whether the new recognition will work in one's favor come tax time depends on one's situation. Let's take a household where one spouse works and the other is a stay-at-home parent.
"They're saving because now they are getting the benefit of now combining their incomes, so the higher income isn't be taxed at the highest income rate," says McDonagh. "It's two people so it's getting combined, so overall their taxes will go down."
However, a dual-income household could now pay the price of marriage equality through the so-called marriage penalty.
"If you are two high-wage earners and you used to be able to file single and now you have to file married joint return, it's going to cost you a lot of money in taxes," says McDonagh.
The DOMA ruling was centered on the issue of estate tax, and it is here that same-sex couples can really benefit, as the federal government allows a taxpayer to leave all assets to a spouse tax-free.
"There's a tax of about 50 percent that's applied when you leave something to a non-spouse," Vito says.
Since same-sex spouses will now be recognized as spouses, that hefty tax no longer applies.
"Now you get the unlimited marital deduction, which in Edie Windsor's case was $363,000. It's significant money," says McDonagh.
Income and estate taxes are just two of a whole host of changes that can affect one's finances. The next "Money Matters" segment will look at some of the others, including health insurance costs and Social Security benefits.