Q. How does the Illinois Religious Freedom Protection and Civil Union Act affect health benefits?
A. All health benefits provided to civil union partners need to be included in income for federal tax purposes, unless employees are federal tax dependents of their partners. Because a civil union partner is not recognized as a spouse under federal law, the value of health care coverage for a civil union partner must be imputed into the employee’s federally taxable income.
Also, an employee can’t make pretax contributions for his or her partner’s coverage and can’t receive reimbursement for health care expenses of a civil union partner through flexible spending accounts or health savings accounts.