On this Valentine’s Day 2014, married couples across America celebrate their love for each other with flowers, candy, and candlelit dinners at fancy restaurants. While it’s not likely top-of-mind today, it’s important to know how being married impacts your IRS tax responsibilities.
When two individuals tie the knot and get married, their tax status with the IRS may change compared to how they filed their taxes in the past. Choosing the appropriate filing status can have a significant impact on how much you pay Uncle Sam in taxes each year – and how much money you keep in your bank account. Remember that the marital status of an individual on December 31st of a given year determines if this person is considered “married” for that calendar year.
Married Filing Jointly vs. Married Filing Separately
Married couples have the option of filing their federal income tax returns as either married filing jointly or married filing separately. In general, filing your taxes jointly tends to have more tax benefits than separate filings. For example, for tax year 2013, married joint filers get a standard deduction of $12,200 compared to the $6,100 amount for married taxpayers who file separately. You may be able to claim more deductions and enjoy other perks through joint filings as well. Regardless of your choice, it’s essential to explore both options to determine the best route for you and your spouse to take.
Factors to Consider
Making this choice often depends on your income. If both you and your spouse work for an employer or are self-employed, the combined total income the two of you make could put you into a different tax bracket. This means your income tax rate could increase based on your previous bracket before marriage. Plus, certain tax credits and deductions have income limits on who can claim them, so be sure to find out which ones you qualify for and how married filing jointly or separately would play a role in your claiming of these tax breaks. Credits are often more readily available to joint filers. In addition, you may also need to submit Form W-4: Employee’s Withholding Allowance Certificate to your employer if your withholding is affected.
Informing Others of Your Marriage
There are several individuals and agencies that must be notified of a marriage for tax purposes. If your name changes, you should notify the Social Security Administration to ensure that your name and Social Security Number match when filing tax returns. Notify the IRS if you relocate to a new address by submitting the Change of Address form. This should be done after notifying the postal service of your change in address to ensure you receive any mail from the IRS. It’s also necessary to provide an employer with this updated information so that you receive tax documents, W-2, or 1099 forms in the mail at your new residence.
Joint Filings for Legally Married Same-Sex Couples
Finally, don’t forget that the IRS announced last year that legally married same-sex couples have the ability to file joint returns. All 50 states now follow this rule, but same-sex couples must be married in states that recognize gay marriage in order to qualify for the option to file jointly.
1-800Accountant offers guidance on how getting married can impact your tax standing with the IRS. To learn more, call 1-888-749-01171-888-749-0117 or check out www.1-800Accountant.