The decision does what needs to be done, namely granting the simple civil right of marriage to a whole group of citizens of this state. Even more wonderful is the overturning of the Defense of Marriage Act. This is so important because being married has real financial advantages which are granted under federal law.
A. Federal gift and estate law:
Under federal law there are estate and gift taxes. Less than there used to be but still some. Federal tax law recognized a straight married couple as a economic entity so their passing property between themselves had no tax result. In contrast when DOMA controlled passing property between members of a same-gender married couple was a taxable gift and leaving property to a surviving spouse was also a taxable event. But, hooray! That important and mean-spirited discrimination is over! In California ALL married people can give and will anything to a spouse with no federal gift or estate tax liability occasioned by the gift. Seems simple, doesn't it?
One happy result with DOMA and Prop 8 gone, for estate planning attorneys is that we can plan the estate planning documents for everyone based on the same set of laws and, speaking personally, I won't have to write in: If same gender marriages are recognized under California and Federal law, then... and have one whole plan for that circumstance and a different plan if the laws continued to be discriminatory. This makes me happy.
B. Pension Plans.
Pensions and Individual Retirement Accounts are governed by Federal law, laws which favor and protect the spouse. For instance, under DOMA a straight husband's retirement account must name his wife as the beneficiary, unless his wife consents in writing to a different beneficiary. Until now a married gay couple did not have to pay any attention to this law, but now they do. This is an economic benefit and protection for the surviving spouse. LEGAL TIP: If you are married and have left your IRA to your sister and your spouse did not consent, your beneficiary designation is invalid and must be redone.
C. Capital Gains Tax.
Under California law, when two people (regardless of gender) are married, the earnings of each spouse during the marriage and while the couple lives together is COMMUNITY PROPERTY.
When federal law did not recognize same-sex marriages, the earnings of the wives were not community property under federal law. One area where this makes a great difference is in the area of federal capital gains tax on the sale of a community property asset after the death of one of the spouses. Now that federal law recognizes the marriage between people of the same gender, if one of the spouses dies, the community property asset is given a new basis, so that when the asset is sold, the gain (loss) is, mostly, calculated as the difference between the basis and the sales price. The prior injustice was that married same-gender couples people in CA had community property under state law but it was not recognized as such under federal law. Look at how detrimental that could be. Suppose that a husband dies and he is the one who does not own the house (bought with his husband's earnings during marriage would make the house a community property asset). The surviving husband then wants to sell the house but he cannot afford the capital gains tax because there is no change in basis. His straight friend in the same circumstances could sell his house with a change in basis which could result in no capital gains tax.
In effect and in reality the tax laws under DOMA discriminated against the non-straight couple, treating them differently than a different-gender couple, treating them as unmarried individuals. This injustice has been eliminated.
DOMA was discriminatory in many other ways having nothing to do with money, but I have only highlighted a few financial issues and that is enough for now.
The fight is not over. We know that the anti discrimination decisions of this week followed by only 24 hours the decision gutting the Voting Rights Act of 1965, in effect, again allowing states to decide who gets to vote and who does not. If this country has to keep fighting that battle, surely discrimination against same-gender married couples is a fight we will all need to keep fighting.
BUT FOR TODAY let's just celebrate however each of us chooses, in the many different ways we can celebrate because, after all, we are all different individuals.