by Tdarcos » Sun Jun 16, 2019 6:30 am
Oprah Winfrey has stated she intends never to get married, essentially saying her long-term partner Steadman will for all intents and purposes remain her boyfriend.
This is a big mistake, unless she is not planning to leave her assets to him when she dies, as most people who have a spouse do.
Why this is a mistake is Oprah is worth over a billion dollars. Let's say she wants to leave her holdings to Steadman when she dies, if they were married there is an unlimited marital exemption for asset transfers and the tax due would be zero. As her boyfriend, there would be an estate tax on everything above about $11.4 million. The tax rate is 40%, or something near $400 million.
One may think they should pay taxes but this kind of contribution is kind of on the high side since these are assets that were bought with money already taxed.
Some of you may remember the first gay marriage case the Supreme Court heard, United States v. Windsor from a few years ago, and it covered this very issue. Windsor was married to her wife in Canada because her state didn't permit gay marriage. When she died, the IRS, citing the Federal Defense of Marriage Act (DOMA, which only recognised male-female marriages), denied Windsor's marriage exemption and demanded $1.2 million in taxes. Following the rules, WIndsor paid the tax, then sued for a refund. The courts found DOMA unconstitutional, but the United States appealed. The Supreme Court found for Windsor and ordered the refund.
I'd say Oprah and Steadman have about 400 million reasons to get married.
Oprah Winfrey has stated she intends never to get married, essentially saying her long-term partner Steadman will for all intents and purposes remain her boyfriend.
This is a big mistake, unless she is not planning to leave her assets to him when she dies, as most people who have a spouse do.
Why this is a mistake is Oprah is worth over a billion dollars. Let's say she wants to leave her holdings to Steadman when she dies, if they were married there is an unlimited marital exemption for asset transfers and the tax due would be zero. As her boyfriend, there would be an estate tax on everything above about $11.4 million. The tax rate is 40%, or something near $400 million.
One may think they should pay taxes but this kind of contribution is kind of on the high side since these are assets that were bought with money already taxed.
Some of you may remember the first gay marriage case the Supreme Court heard, [i]United States v. Windsor[/i] from a few years ago, and it covered this very issue. Windsor was married to her wife in Canada because her state didn't permit gay marriage. When she died, the IRS, citing the Federal Defense of Marriage Act (DOMA, which only recognised male-female marriages), denied Windsor's marriage exemption and demanded $1.2 million in taxes. Following the rules, WIndsor paid the tax, then sued for a refund. The courts found DOMA unconstitutional, but the United States appealed. The Supreme Court found for Windsor and ordered the refund.
I'd say Oprah and Steadman have about 400 million reasons to get married.