July 13th, 2015 → 2:37 pm @ Lance R. Drury // No Comments
From beginning to end, summer is the most popular time for weddings. Couples everywhere tie the knot and merge their financial lives and make the most of the tax advantages that come with the designation of “married filing jointly.” You actually have the choice of filing separately or jointly. It is worth determining which way results in the lower tax liability.
Starting the journey of marriage on the right foot applies to the tax and financial considerations as well as all the other personal levels. So, whether it is you who are tying the knot, or someone you know, the following considerations can help to make the transition to married life much easier especially at tax time.
Name and address changes.
The names and Social Security numbers on your tax return must match Social Security Administration (SSA) records, so report any name change by filing Form SS-5, Application for a Social Security Card. You can download the form on ssa.gov. Notify the IRS of an address change by filing IRS Form 8822. You may also report the change at your local post office.
Beneficiary forms.
Update beneficiary forms for life insurance, retirement accounts, and other financial accounts as soon as possible. For some accounts, your current spouse is automatically the beneficiary, but you should still change your forms. (You may have to make specific provisions for any children from a previous marriage.)
Filing status.
If you are married as of December 31, for tax purposes, the IRS considers that you were married for the whole year. You and your spouse can choose to file your federal income tax returns either jointly or separately each year. Choose whichever way gives the greatest tax advantage.
Tax withholding.
You must give your employer a new W-4 form to change your withholding. You and your spouse’s combined income could move you into a higher tax bracket, but it’s also possible that filing jointly will reduce your tax liability. You may want to use the IRS withholding calculator at irs.gov/Individuals/IRS-Withholding-Calculator. If you are self-employed, recalculate your estimated tax payments.
Affordable Care Act (ACA) issues. If you bought insurance from the Health Insurance Marketplace and received an advance payment of the premium tax credit, report any changes in income or family size to your marketplace. You should also notify the marketplace if you move out of the area covered by your plan.
While most people recognize that marriage presents a host of joys as well as challenges, many people fail to address the financial issues prior to embarking on this remarkable journey. Taking care of the basics above will make everything else easier when it comes to taxes. You’ll want to have your energy and focus on the other aspects of marriage that are more rewarding.
Tags: CPA, Financial Advice, retirement advice, retirement information, Tax Advice, Tax Information, Tax Tips
