Can I add girlfriend to my benefits provided by employer?

Question

I work in a big tech company in the Bay Area, California. It is time to enroll in benefits and I am trying to understand if I can add my girlfriend to my insurance.

I have been living together with my girlfriend for 2 years and I would consider this to be a serious relationship. However, we have not registered our relationship anywhere officially. The only documented proof w.r.t. relationship that we have is the same address on our individual bank statements. We don't even have joint bank accounts or anything like that.

Here is what my ADP website through which I have to make election has to say about enrolling partner in benefits. I have four questions regarding that:

1. Has anyone tried to add girlfriend to their insurance in similar situation where the only proof of relationship is the same address on bank statements? Is this enough?
2. What does "... and agree that anyone who is owed these expenses can collect from either of you"? Do I automatically make election here that, if, for example, she has a loan for her car, then the bank also can go after me (like for married couples)? Or is the scope of expenses here only regarding to benefits. For example, if she reached dental insurance limits then the insurer can go after me?
3. What happens in case we terminate our relationship? Does this have any further implications?
4. Are there any tax implications after I make this election? I would prefer to keep filing taxes the way I have always been doing and that she file her taxes the way she has always been doing.

Answer 1

Heterosexual couples have benefited from insurance benefits being extended for "domestic partners". The intent was not to judge if a couple was hetro or homosexual but extend benefits for "serious" romantic partners. At the time of the inception of these benefits, IIRC, no state offered same sex marriage or any kind of civil union statuses.

So I bet you are just fine in this, but I would check with my HR director.

To answer your questions:

1) I have. There were two times in my life that I was living with a woman and we shared benefits despite there being no formality to our relationship.

2) I am sure this is referring to health expenses; and, mostly FSA expenses.

The insurance company does not care if you don't pay your doctor. However, they will care if you charge a bunch of non-medical expenses to you FSA account and don't intend to pay it back. This would include the case if you use your FSA for qualified expenses but don't provide sufficient documentation.

Answer 2

There are some nuanced differences between a marriage and a domestic partnership, and your employer may require that you prove your relationship with something like utility bills or phone bills or something similar. Some of these nuances will depend on what state you're in, what state in which the plan is sitused (usually the headquarters of your company if it has more than one geographic location), your employer's specific policies.

For instance I've seen situations where domestic partnership benefits eligibility was removed from a plan after gay marriage became legal.

The IRS sets the tax rules related to employee contributions to employer plans and the IRS refers to married couples specifically. Very technically, your contribution to the plan as an employee will get the section 125 tax preferred treatment but the contributions for a domestic partner don't.

1. It will depend on your employer, plenty of employers offer benefits to domestic partners regardless of gender without requiring much by the way of proof.

2. What you've found is just the eligibility language of your plan, it's not legally binding to you in any way. Your employer will do the vetting to determine the illegitimacy of your partnership, and that will have nothing to do with a requirement you may have to pay a medical (or any other bill) for your partner.

3. Assuming your employer is large enough to be subjected to COBRA requirements, following the termination of your relationship, and termination from coverage under the plan, your partner would receive a COBRA offer from the plan. That probably won't involve any direct involvement from you though apart from providing a new address.

4. The only tax implication (that I can think of) is that your contribution for your partner will not be removed from your paychecks on a tax free basis.

Many large employers don't expend much effort vetting this sort of thing in fear of enhanced wrongful termination liability. Assuming the employer is large enough to control its own eligibility the insurance carrier involved will also not make any attempt to vet the legitimacy of your relationship either.

Answer 3

For this point:

4. The portion of your employer's contribution to the medical plan that will be used for your partner will not be tax deductible. Generally employer's pay a portion of medical plan cost and this is deductible when single or married. However, the portion that goes to the partner in a domestic partnership is not tax deductible. This means your tax burden would likely increase. Example: Your medical plan costs you 50$/month in premiums and your employer pays an additional 100$/month. In this case, a portion of the additional 100$/month would be taxed.