WEST PALM BEACH — The office of Palm Beach County Constitutional Tax Collector Anne Gannon has instituted a policy which will help offset additional taxes paid by employees who elect to provide health insurance to their domestic partners, an action taken at the request of the Palm Beach County Human Rights Council.
Under federal tax laws, unmarried employees with domestic partners and same-sex married couples are taxed on the imputed value of employer-paid family health insurance benefits, a situation that does not apply to opposite-sex married employees possessing the same family coverage, who are not taxed on the value of that same family health insurance coverage.
Federal legislation to amend the Internal Revenue Code to end the taxation of health insurance benefits provided to domestic partners was first introduced in 2003 by U.S. Sen. Bob Graham (D-FL), but there has been no progress made to enact it at the national level in the past decade.
“My employees whose families are based on domestic partnerships pay more federal taxes than married employees for the same family health insurance coverage,” said Gannon. “That is unfair. I won’t wait any longer for Congress to end this inequity.”
Gannon’s tax equity policy provides employees who elect to insure their domestic partners with an annual tax equity reimbursement of $500 to mitigate the impact of the additional income taxes paid by employees with domestic partners.
Last month, Palm Beach County Property Appraiser Gary Nikolits implemented a similar tax equity program for his employees. In the public sector, only Hallandale Beach and Cambridge, Massachusetts have taken steps to address this tax inequity.
West Palm Beach Mayor Jeri Muoio recently informed the Palm Beach County Human Rights Council that her city will consider a tax equity program for its municipal employees, and attorneys for the cities of West Palm Beach and Miami Beach are working together to draft a policy which they hope will become a nationwide model for public employer tax equity programs.