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Judge backs tax exemption for Alaska same-sex couples

Rosemary Shinohara

An Anchorage judge has ruled that same-sex couples in Alaska qualify for the same exemptions on local property taxes as those that apply to married couples.

At issue are a state law and regulations that mandate local governments offer property tax exemptions for seniors 65 years old and up, and for disabled veterans.

The exemptions are for taxes on the first $150,000 of assessed value of someone's primary residence.

State regulation to this point interprets the law as saying a married couple can get the full exemption whether the property is held in one name or both. If one hits 65, even if the spouse is younger, they qualify.

But if same-sex couples or other unmarried couples share ownership and occupancy, the regs say an eligible person can only exempt value proportionate to the amount of the house he or she owns.

Superior Court Judge Frank Pfiffner ruled on Friday that married couples and same-sex domestic partners are "similarly situated," and due equal protection under the state constitution. That means equal tax exemptions, he said.

Three Alaska same-sex couples brought the suit, saying they had been denied equal tax benefits. They are represented by the ACLU of Alaska and the national American Civil Liberties Union

Here's how it worked for one couple: plaintiff Julie Schmidt was 67 and eligible, but her partner Gayle Schuh was 62. Schmidt was able to exempt only half the full value of her Eagle River home -- worth $254,200 last year -- because the state only gave her credit for occupying half the house, or $127,100 worth of it. If the two were married, they could exempt $150,000 worth and get $359.31 more off their taxes.

The judge notes same-sex couples are forbidden from getting married under a 1998 state constitutional amendment that defines marriage as between one man and one woman. Yet they're due equal treatment.

The judge relied on a prior decision by the Alaska Supreme Court that said the state had to extend health and other benefits to same-sex partners due to the equal protection clause.

The state is still assessing what the latest decision means, said Rachel Witty, an assistant attorney general with the Alaska Department of Law.

How will it affect two people of the opposite sex who are co-habiting but not married?

Jeffrey Mittman, director of ACLU Alaska, believes nothing will change for them. If they want the tax benefit, they can legally marry and get it, he said.

Witty said the answers to that question and others such as how many people will become eligible for exemptions, and how the ruling will affect cities that are collecting the taxes are difficult to know yet.

The plaintiffs have 10 days to submit paperwork to the court on what the judgment should say, said Witty.

Reach Rosemary Shinohara at rshinohara@adn.com or 257-4340.


By Rosemary Shinohara
Anchorage Daily News