covering common law spouses on insurance

cbourb · September 2003

Do any of you allow common law spouses to be covered on your health insurance? If so, do you require them to complete an affidavit? If you have them sign an affidavit, how have you crafted it so it will cover all the varying state definitions of common law marriage?

If you do cover common law, do you treat this spousal coverage as any other...or do you treat it as you would for same-sex domestic partner coverage (i.e. premiums must be after tax.)

We are a multi-state employer and per our handbook we say that common-law spouses are eligible for coverage. But no employee has ever requested to cover a common law spouse until now. Any help you can provide is much appreciated.

Whatever · September 2003

We do not cover common-law spouses simply because common-law marriages are not recognized in NY or NJ. Since you are a multi-state employer, you should check on what the law is in each state. However, remember you can always be more generous that the law.

Pearce · September 2003

The taxability issue is actually an IRS issue. That is, if the common-law spouse cannot be claimed as a dependent on the employee's federal tax return then the value of the benefit would be taxable income (as with a domestic partner).

marc · September 2003

No coverage for common law spouses at our company. Pearce is correct regarding the tax issue.

Steve McElfresh · September 2003

The information on deductibility above appears basically correct as I understand it.

BUT: the fact that you (and the couple) are not located in a common-law state may not insulate you from addressing this issue. The quick reference I have available indicates that common-law marriages are recognized in the states listed below -- *AND* that other states and the IRS will generally recognize such a marriage if properly initiated in a common-law state. If so recognized, I suspect the couple would be covered under your plan with or without reference to "common-law" in your plan documents. Married is married.

But you need a benefits lawyer to be certain.

Note that the states below will have varying requirements to recognize common-law marriage, but that they tend to include at minimum: legal capacity to marry, intent to marry, communication of such intent to each other, living together, holding the couple out to the community as being married (for example, and only as an example, using same last name, etc.)

Alabama
Colorado
District of Columbia
Georgia (if created before 1/1/97)
Idaho (if created before 1/1/96)
Iowa
Kansas
Montana
New Hampshire (for inheritance purposes only)
Ohio (if created before 10/10/91)
Oklahoma
Pennsylvania
Rhode Island
South Carolina
Texas
Utah

Just to emphasize the fact that "married is married", to the best of my knowledge in common-law states there is no "common-law divorce". That is, such folks get to go through the same pain as everyone else.

Warm regards,

Steve Mac

Steve McElfresh, PhD
Principal
HR Futures
408.605.1870

Rockie · November 2003

You are correct Steve on the point of there being no "common law divorce" One of our employees found this out the hard way when she tried to "walk away" from a common law relationship. Her significant other legally went after her retirement as well as support. She was very surprised when her attorney advised her she would have to get a divorce.

We do request affidavits from those individuals who specify "common law". Often when they are asked to submit an affidavit, they decline.

covering common law spouses on insurance

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