Our Thinking

Opower equalizes tax burden on health insurance for married gay and lesbian employees

  • By Eric Fleming
  • June 13, 2012

We’re pleased to announce that, retroactive to January 1, 2012, we will equalize the tax burden on health insurance coverage provided through Opower to the married spouses of our gay and lesbian employees.

While we’ve always offered health insurance coverage for all our of employees and their spouses and domestic partners, the federal government continues to tax heterosexual married couples and gay married couples differently on health insurance benefits.

Here are the details: heterosexual married couples don’t pay income tax on employer-provided health insurance coverage for their spouses because they are viewed as a single economic unit in the eyes of the federal government. Under current federal law, however, employer-provided health benefits for the husbands and wives of legally married gay and lesbian people are counted as taxable income (if the spouse is not considered a dependent)–so same-sex married couples are taxed on the value of the spouse’s insurance coverage. In addition, married gay and lesbian employees cannot use pretax dollars to pay for the spouse’s health insurance premiums, unlike their opposite-sex married counterparts.

We’re extremely proud of our decision to provide this equalizing benefit—and of our company heads, Dan and Alex, for their leadership on this issue—since we believe this makes us the first company based in Virginia, and the first small business in America, to do so! We now join the ranks of companies like Facebook, Google, Apple, Bloomberg, McKinsey, and jetBlue in providing financially equitable health-insurance coverage to all of our married employees and their families, regardless of their sexual orientation.

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