N.J. Admin. Code § 17:1-5.7

Current through Register Vol. 56, No. 23, December 2, 2024

Section 17:1-5.7 - Civil unions

(a) Civil union partners have all the rights and privileges of married couples. The Federal Internal Revenue Code (IRC) allows an employer to provide certain benefits to its employees on a tax-exempt basis. Those benefits can also be extended to spouses and dependents of an employee on the same tax-exempt basis. The IRC, however, does not recognize a civil union partner in the same manner as a spouse and does not automatically recognize a civil union partner as a dependent for tax purposes. Therefore, employers may have to treat civil union SHBP and SEHBP benefits as taxable on Form W-2 and withhold Federal income, Social Security, and Medicare taxes on its value. The employer shall be responsible for the employer share of Social Security and Medicare taxes due on the civil union benefit, including the taxes due on any State paid benefits.

1. The income reported by the employer shall be the full cost of single coverage in the plan in which the civil union partner is enrolled.

2. Anything that the employee or retiree pays for the civil union coverage through premium sharing arrangements will reduce the amount of the income reported to the Federal government for the civil union benefit. These premiums cannot be made on a pre-tax basis unless the civil union partner meets the Federal definition of dependent. If the civil union partner qualifies as a dependent of the covered member for Federal income tax purposes, the value of the civil union benefit will not be taxable to the employee or retiree, and any premium paid by the employee toward the civil union partner can be deducted on a pre-tax basis through the State's Section 125 TaxSave Program. To be eligible for the tax exemption, the employee or retiree must file a certification of tax dependency with the Division.

N.J. Admin. Code § 17:1-5.7

Amended by 48 N.J.R. 1306(a), effective 6/20/2016