Pension Bill Protects Same-Sex Couples

The Pension Bill that President Bush signed on Thursday contains two important protections for same-sex couples (and other Americans who leave their retirement savings to non-spouse beneficiaries).  From Human Rights Campaign:

The first provision allows the transfer of an individual’s retirement plan benefits to a domestic partner or other non-spouse beneficiary (sibling, parent, child, etc.) when the individual dies. Specifically, the surviving partner (or other non-spouse beneficiary) will now be able to transfer his or her deceased partner’s retirement funds into an Individual Retirement Account and either draw down the benefits over a five-year period, or over his or her own life expectancy. In the past, surviving same-sex partners or other non-spouse beneficiaries in similar situations were typically forced to withdraw the entire amount as a lump sum and incur immediate tax charges. In addition, this action often bumped the survivor into a higher tax bracket because the withdrawal was counted as taxable income to the beneficiary.

The second provision, which addresses retirement plan hardship distributions, allows gay couples (and others with non-spouse, non-dependent beneficiaries — siblings, parents, children, etc.) similar access to laws that permit people to draw on their retirement funds in the case of a qualifying medical or financial emergency. In the past, the federal law covered only the spouses or dependents of employees when it came to accessing retirement funds during an emergency.

(Hat Tip:  Daily Feminst News via Feminist Law Professors.)  For press coverage, see:

• Associated Press:  New Law Helps Same-Sex Couples
• Huffington Post:  Pension Act Provides Historic Protections to Same-Sex Couples Under Federal Law
• San Francisco Chronicle:  Same-Sex Pairs to Benefit Under New Pension Law; Provision Allows Nonmarried Beneficiaries to Postpone Taxes
• UPI:  New Pension Tax Law Helps Same-Sex Couples