When the U.S. Supreme Court struck down critical sections of the Defense of Marriage Act (DOMA) earlier this summer, it opened the floodgates for same-sex couples to receive federal benefits they were previously eligible to claim. Now, the Department of Justice is reviewing thousands of laws and regulations which had been based upon the traditional definition of “marriage” as the union of a man and a woman to see how they might be affected.
One federal program that will be significantly impacted is Social Security.
Under DOMA, even if a same-sex couple were married in a state that recognized such unions, they were not entitled to “spousal” benefits. These include income a spouse is entitled to by virtue of the fact that s/he is either currently married to someone who earned the required 40 credits of Social Security(1), are divorced from such a person (after at least 10 years of marriage) or are a widow[er] of such a person.
In anticipation of that this will soon change, Social Security has just begun accepting applications from same-sex couples who wish to receive retirement benefits based upon the work history of their spouse. Timing is important because this locks in the filing date so that when Social Security gets the OK to start paying benefits, no one will lose any benefits for waiting.
“If you file for benefits before you are full retirement age(2), the effective date is the month that you submitted your claim. For instance, if you wait until October, but you could have been entitled in August, October is considered the month that you filed,” explains Social Security spokesperson Dorothy Clark.
Although Social Security does not yet have instructions from the Justice Department, it will hold applications until it receives guidance and any benefits will be back-dated. For instance, if policies regarding retirement benefits to same-sex couples are issued in October, but the filer could have been entitled as early as August, he or she will receive benefits for August and September.
“Since we don’t have any rules on how to process these applications at this time, we are encouraging people to file so they don’t lose any benefits,” says Clark.
1. Regardless of gender, in order to be entitled to a spousal benefit your spouse must have filed for Social Security him/herself.
2. The earliest age you can file for a (reduced) spousal benefit is 62. Currently, “full retirement age” (FRA) is 66.
Ms. Buckner is a Retirement and Financial Planning Specialist and an instructor in Franklin Templeton Investments' global Academy. The views expressed in this article are only those of Ms. Buckner or the individual commentator identified therein, and are not necessarily the views of Franklin Templeton Investments, which has not reviewed, and is not responsible for, the content.
If you have a question for Gail Buckner and the Your $ Matters column, send them to: firstname.lastname@example.org, along with your name and phone number.