This seems like such an easy question, but it isn’t. Why? Because it
depends on for what issue one asks this question. And there are
numerous issues for which one could ask this question. The most
frequent areas for our clients in which this question arises are
community property law, Veterans Benefits, Medi-Cal, and Income Tax.
California State Law
Purposes
Obviously, if a couple is married, they are a couple for virtually
all purposes. In California, we also have domestic partnerships. By
statute, domestic partnerships can be entered into only by same sex
couples or opposite sex couples in which at least one partner is at
least 62 years old. If the domestic partnership is
registered with the
California Secretary of State (as opposed to through a city
registration), then the couple is treated the same as a married
couple for virtually all California law purposes. These purposes
would include community property and California income tax, as well
as others. [Back to Top
of Article]
Veterans Benefits
Federal law does not recognize the California domestic partnership,
registered or not. However, the issue as to when a couple is a
couple often arises in this field. To qualify for some Veterans
Benefits, the combined income and expenses as well as the net worth
of both members of the couple are taken into consideration.
Often, we are presented with the situation of a husband and wife who
are not living together. One spouse is in need of the
VA Aid & Attendance non service connected pension. This is one
of those benefits that treats the two married individuals as one
budget unit. The in need spouse does not know anything of the
financial circumstances of the other spouse. The in need spouse
wants to file based solely on his or her own financial situation.
Can this be done? The VA regulations are very clear that the couple
is treated as one budget unit unless they are estranged from each
other.
Estranged, according to the dictionary, means alienated from one
another. Although that definition is perhaps not as clear as we all
might like, some cases are obvious. In one case the husband was
still at least partially supporting the wife. That definitely was
not estranged. In another, they hadn’t seen or spoken to each other
in years and neither was supporting the other. That definitely was
estranged. [Back to Top
of Article]
Medi-Cal
Medi-Cal is a joint federal-state program. Registered domestic
partnerships are not recognized under federal law but are under
California law. According to the
California Department of Health Care Services there is no
federal reimbursement to the state for any Medi-Cal expenditures
based on this type of relationship. Therefore, this relationship
only affects state only Medi-Cal programs. The
Medi-Cal long term care program is not a state only program.
Medi-Cal typically looks at the members of a couple as one budget
unit for purposes of net worth, share of cost (a Medi-Cal term
having to do with the income of the applicant). If the members of
the couple are living separately, typically they are not treated as
a couple (i.e they are not treated as one budget unit).
[Back to Top of Article] Income Tax
A relationship as a married (or equivalent) couple can have profound
effects on one’s income taxes for purposes of tax bracket and
deductions. Often these effects are negative and, hence, the term
“marriage penalty.” Since Federal Law does not recognize registered
domestic partnerships, federal income tax law does not either. As
stated above, California income tax law does recognize this
relationship. [Back to
Top of Article]
