By Richard Chapo
They say the world works on a concept known as balance. To counterbalance the joys of your honeymoon, you get the misery of filing a joint tax return with your spouse.
If you have recently married, you are hopefully living a blissful life of humor and happiness. The birds are singing, everyday is sunny and so on. Alas, there is one event each year that brings the joy of newlyweds to a screeching halt. That event occurs when you must sit down and file a joint tax return. Somewhere, a divorce attorney is smiling.
Before you and the spouse start shouting at each other, it probably makes sense to figure out how you will file. Essentially, you have two choices. The first is known as married filing jointly and it usually the best way to go. The second is married filing separately and often results in higher taxes being paid. Yes, this all takes into account the ‘marriage penalty’ for taxes. The media has the problems backwards.
There is, however, one instance when going with married filing separately may definitely make sense. The situation occurs where there is a serious imbalance in the earnings of each spouse, to wit, one is making a lot more than the other. Mentioning the issue alone can be a test on a relationship, but taxes are all about saving money. Essentially, the situation boils down to deductions. If you itemize, but lose deductions under the joint filing, it is time to file separately. The only way to tell [groan] is to actually prepare the tax returns for each situation. Hey, nobody said taxes were fun.
If you really want to tackle a tough issue, there is one other time when you should definitely file separately. Since you can’t slap me through the computer, I can tell you it is when your marriage is on the rocks. The reason has to do with joint liability. You and your spouse are jointly liable for all taxes you owe the government. If one of you does not pay, the IRS will look to either of you to get its money. When marriages go bad, the failure to pay taxes is often used by a disgruntled spouse for revenge. While filing separately makes logical sense, marriage problems are not logical. Give a lot of thought to the process before bringing this issue up.
In general, filing jointly is the way to go in most marriages. There are instances that call for filing separately, just be very careful about how you approach them!
About the Author: Richard A. Chapo is with
businesstaxrecovery.com
– everything you need to know about taxes.
Source:
isnare.com
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