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Same Gender Domestic Partner Medical and
Dental Insurance Amounts ...
Excludable From Gross Income
An employer provides medical and dental coverage for its employees
and their eligible dependents under a welfare benefit plan which
includes same-gender domestic partners. Prior to the
same-gender domestic partners enrollment in the plan, the employee
and domestic partner must complete and have notarized a Domestic
Partner Affidavit to certify that a domestic partner relationship
exist. This must be done annually to confirm the
relationship for continuation of benefits.
Although an employee's same-gender domestic
partner doesn't qualify as a "spouse" under the Internal
Revenue Code, he or she may qualify as dependent if the §152(a)(9)
and §152(b)(5) requirements are met. Therefore, the
employer can rely on domestic partner certification to show that
the support and relationship tests are met, and to establish the
domestic partner as a dependent for the sake of determining
taxability of partner medical and dental coverage.
Coverage and reimbursements to qualified
dependents are excludable form the employee's gross income under
§§105 and 106 and are not includable in wages for employment tax
purposes. However, any amount in excess of FMV of coverage
for a partner who does not qualify as a dependent, over the amount
the employee paid for coverage, is includable in gross income and
subject to employment tax.
PLR 200339001
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