Cambridge, MA set to Pay Gay Employees More Than Straight

A Massachusetts city will start paying its gay employees a stipend so it can offset an unequal federal tax.

When the city of Cambridge issues paychecks to its public employees, 22 gay workers find a federal tax on their income that their heterosexual colleagues don't have to pay.

Like many people, these school and city workers chose to put their spouses on their employer-provided health insurance.

Because they're in a homosexual relationship, the federal government taxes that health coverage.

As a result, this month Cambridge will be the first in the country to pay its public employees a stipend to defray the cost of the federal tax.

The city employees hit by the extra tax pay an additional $1,500 to $3,000 in taxes a year and officials estimate the stipends would cost the city an additional $33,000.