It Gets Worse: Queer People “Volunteer” To Help To Ease The Tax Burden For Straight Families

January 24, 2011, 10:48 am

Remember in my last post when I said it doesn’t always get better?  A little bird down the street at Yale –erp, I mean, Oligarch University twigged me last week to a payroll error, because of which 61 employees will see a paycheck reduction of 33% or more for January and the subsequent two months.  Right before winter break, LGBT employees who had taken advantage of Connecticut’s new freedom to gay marry received a letter telling them of a payroll error:  the university had ceased withholding taxes on the benefits received for domestic partners who had become spouses under state law — but not federal law.  The upshot, for those of you who suffer temporary black out when taxes are mentioned, gay married people get to pay two years of taxes in one.

Homos are just more patriotic, that’s all.  Photo Credit.

In many ways, this falls under the category of discriminatory behavior that allows universities to perform budget trimming immoral acts because they are perfectly legal, while insisting that it is not they who discriminate.  For those of you not familiar with what those of us who pay it call “the gay tax,” homofolk whose marriages are not recognized under federal law pay federal taxes on benefits that are untaxable for  heterofolk, resulting in thousands of dollars of penalties that gay people pay.  According to Tara Bernard at the New York Times (January 11 2011):

A programming error failed to withhold income for taxes owed on the value of domestic partner health coverage….the value of those benefits are taxable (for nondependent partners) by the federal government. But in states like Connecticut, same-sex married couples are treated the same as opposite-sex married couples, and those benefits are not taxable on their state income tax returns.

“Unfortunately, the payroll system inadvertently treated those benefits as nontaxable for Connecticut and federal purposes for the entire calendar year of 2010,” said a letter, dated Dec. 22, from Yale’s payroll department to employees with same-sex partners who were affected by the error. To correct the error, the university went on to say, it would pay the tax and deduct the amount it paid from employees’ paychecks — in equal amounts over the first three months of 2011.

The university, which has extended health insurance to its same-sex employees’ domestic partners since 1994, typically withholds those taxes from employees’ paychecks over the course of the year. But due to the programming error, employees will be responsible for paying the taxes for both years in 2011.

Oligarch has offered “a more flexible repayment schedule” in the event that losing a third or more of a person’s salary causes them any hardship. Gosh, do ya think? But honestly, you know what causes a hardship?  Being paid less for doing the same job than straight people are.  As Bernard pointed out last December, a provision of the federal health care bill that would have eliminated this tax on health benefits was dropped from the final legislation.  A very small number of employers (Google, Cisco and the Gates Foundation) reimburse employees for the cost of this discriminatory tax, a practice called “grossing up.” Very few institutions of higher ed follow this practice (Syracuse is one — commenters are invited to name names), and it is particularly shameful that one as well-endowed as Oligarch does not.

The university has received public criticism from the Human Rights Campaign; you can go here to sign a petition to tell Yale how stupid they are on this issue.  But while you are at it, if you are an academic, tell your own university about the anti-gay discrimination that helps them pay for essentials like football, keeping the cost of Alumni/ae weekends low, Presidential salaries in the millions and giving iPods to every entering freshman.  Check out the schools you graduated from, and let them know how you feel about a practice that writes discrimination into the law and violates the equal protection clause of the Constitution. Hey, I’ve got an idea, Yale Law profs:  how about filing a big, fat civil rights suit on behalf of your colleagues?

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