Love should be your major consideration in deciding whether to get married. But getting married (or not) also has tax and financial consequences.
For instance, when you get married, your tax situation changes—for better or for worse. Sometimes it’s for worse.
Since we focus on taxes here, let’s look at the tax consequences of getting married—including some tax-related reasons not to get married.
We realize this sounds harsh, but it’s better to understand these negatives now rather than finding out about them the hard way, after marriage is a done deal. Here’s what you need to know.
Married at Year-End Means Married for the Whole Year
Your marital status as of December 31 determines your federal income tax filing options for the entire year.
If you’re married at year-end, you have only two choices:
1.
File jointly with your spouse.
2.
Use married-filing-separately status for separate returns based on your and your spouse’s respective incomes, deductions, and credits.
Why Most Married Couples File Jointly
There are two reasons why most married couples file jointly instead of separately.
1.
It’s simpler. You file only one Form 1040, and you don’t have to worry about figuring out which income, deduction, and tax credit items belong to which spouse. Other things being equal, simple is good!
2.
It’s often cheaper. Using married-filing-separately status makes you ineligible for ... Log in to view full article.