Saturday, May 2, 2009

Love and Taxes

Marriage is a beautiful commitment between two people who love each other wholly and completely. One proposes, the other says, "yes," and then the two plan a beautiful wedding.

But what happens after the wedding? Not only will you take each other into account before making decisions, but now it's also time to consider, Uncle Sam. Taxes are fun!

Check out this article below from and get a better understanding of what happens to you and your taxes after the "I do's."
You've tied the knot, but when it comes to taxes, you definitely don't want to encounter any knotty problems. Not to worry. True, there definitely are some specific tax considerations for married filers. And some taxpayers might find they are paying slightly bigger tax bills. But marriage also offers many tax advantages.

Filing status
Your wedding date is as important to the IRS as it is to you. For filing purposes, you are married for the full tax year as long as you exchange vows by Dec. 31.

After you're married, you can send in your returns jointly or as married filing separately. Most couples prefer the joint option, but depending upon your particular financial and tax circumstances, separate filings could be warranted.

Joint filing typically is a good idea if you both work and one makes considerably more than the other. Combining incomes could bring the higher earnings into a lower tax bracket. Some tax credits are only available to a married couple when they file a joint return. And logistically, it's easier to deal with just one return.

Separate returns might be preferable if one spouse has large medical bills and can meet the deduction threshold by considering only his or her income. Other itemized deduction thresholds (miscellaneous deductions or casualty losses) also could be easier for just one partner to meet.

Keep in mind, though, that if one spouse itemizes on his or her separate return, the other spouse also must itemize. That could pose a costly problem for a spouse who has no or few itemized expenses and would be better off claiming the standard deduction.

Separate filing also is recommended when a spouse has concerns about tax claims the other wants to make. In most situations, when couples file jointly, each partner accepts equal responsibility for any tax due or penalties that might be assessed if problems arise with the return.

Check out the rest of the article here.

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