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Home > News
Chairman Rangel’s Health Care Mark Includes
Domestic Partner Benefits Bill
July 17, 2009
 Rep. Jim McDermott announced this evening that House Ways and Means Committee Chairman Charles Rangel included McDermott’s domestic partners legislation (Tax Equity for Health Plan Beneficiaries Act, HR 2625), as a provision in the chairman’s mark of health care legislation before the full committee today and tonight.
“I appreciate Mr. Rangel’s support by including my legislation as Section 461 of the chairman’s mark that would ensure that employer-provided health benefits are not taxed as income,” Rep. McDermott said.
As written, the amendment would eliminate federal income and payroll taxes that are currently imposed on health care benefits provided to domestic partners.
McDermott has been a stalwart champion of correcting what he sees as blatant inequity and injustice affecting domestic partners across the country, and the action by the chairman is a major positive step toward finally addressing the issue.
Today, over half of the Fortune 500 companies offer health benefits to their employees’ domestic partners, including several model corporate citizens in the State of Washington.
As McDermott explained when he introduced his legislation March, under the existing tax code, a typical employer-provided health care benefit is exempt from federal income and payroll taxes, providing employers and employees alike with an inherent tax break. However, the existing tax code treats domestic partner benefits differently and imposes a payroll tax on the employer who provides the benefit and an income tax liability on the employee who receives it.
Section 461 of the chairman’s amendment would finally fix this issue, and ensure that the various new forms of employer-provided health benefits are not taxed as income.
“Doing this will correct a long standing injustice and will help make health care coverage more affordable for more Americans, which is what our effort is all about.”
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