A Note on Same-Sex Marriage Before Diving into Innocent Spouse Relief (Obergefell v. Hodges)

Obergefell v. Hodges, 135 S. Ct. 2584 (2015)

(a) Two years ago, it appeared that the United States would be divided for some years between states that recognize same-sex marriage, and states that do not recognize same- sex marriage.

(b) After Windsor, most federal courts held that state provisions refusing to recognize same-sex marriages are unconstitutional. See, g., Bostic v. Schaefer, 760 F.3d 352 (4th Cir. 2014).

(c) This issue reached the S. Supreme Court in Obergefell. The Court held that as a matter of federal constitutional law, states are not permitted to allow only opposite-sex couples to marry. If a state recognizes opposite-sex marriages, it must also recognize same-sex marriages.

(d) The choice-of-law question has therefore fizzled into irrelevance. All states must permit same-sex couples to marry, and all same-sex couples who do marry are entitled to file a joint federal income tax return.

A less well settled topic is that of innocent spouse relief.

Deihl v. Comm’r, 603 F. App’x 527 (9th Cir. 2015) (unpublished)

(a) Facts: A wife sought innocent spouse relief from tax due on returns she filed jointly with her late husband. She claimed that she was entitled to relief because, among other things, she was abused during the marriage.

The Tax Court denied relief, finding that the wife was not abused, and the wife appealed to the Ninth Circuit.

(b) Issue: For purposes of innocent spouse relief, was the wife subject to abuse?

(c) Answer to Issue: No.

(d) Summary of Rationale: The Tax Court’s decision was based upon the credibility of the witnesses, and would therefore be reviewed only for clear error. The court found no such error:

Appellant contends that the Tax Court was bound to accept her testimony of abuse because the Commissioner did not directly contradict it. In fact, to the contrary, the Tax Court, like any other trial court, has no obligation to credit the uncontradicted testimony of interested parties. . . .

Given the fact that Appellant did not substantiate her allegations of abuse, and that record evidence indicated that Appellant was active in the business operations giving rise to her tax liability, the Tax Court did not clearly err in denying Appellant’s petition for innocent spouse relief. Id. at 529.

Comments:

1. The new emphasis on abuse is a good thing for taxpayers who were truly abused. But predictably, a number of taxpayers who were not actually abused are going to try to use the new emphasis upon abuse to obtain innocent spouse relief. The federal courts are going to have to draw some lines as to what is and is not abuse.

2. When alleging spousal abuse for tax purposes, the ideal practice is clearly to support that claim with evidence other than the claiming spouse’s own testimony. Third-party testimony would be best; physical evidence (pictures of bruises) would also be helpful.

3. Deihl does not necessarily hold that it is impossible to prove abuse without corroborating evidence. The opinion carefully stresses the highly deferential standard of review on factual issues.

4. It should not be impossible to prove abuse by the claiming spouse’s testimony alone. Spousal abuse is often a private crime; finding third-party evidence is difficult. If the Tax Court accepts a spouse’s uncorroborated claim of abuse, its opinion should be given just as much deference as if the Tax Court rejects such a claim.

5. But if the Tax Court finds that a spouse’s uncorroborated claim of abuse is not credible, the chances for reversal on appeal are probably not very good.