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One of the most impacting changes marriage has on your personal status (as well as your spouse's) is taxes. As long as you are legally married as of the last day of the tax year, you are considered married. Therefore, the IRS considers you married for the full year even though you got married on December 31st.


Many couples are under the impression that once they are married, they must file taxes together with their spouse. This is not true. There are two available options: married filing jointly or married filing separately. Your personal situation, will dictate which option would be best you should do, i.e. combined income.

Filing separately
The following adverse tax implications include:
  - You may not be qualified for specific credits, i.e. education credit and the earned income credit .
  - A spouse that is not employed will not be able to make contributions towards an IRA.
  - Even though you may receive a federal refund, you may end up owing a great deal in state taxes.

Filing separately may be beneficial if one spouse owes money to the IRS and the other is due a refund. Also, if one spouse has considerable medical costs, casualty losses and/or miscellaneous deductions that must meet a percentage-of-income threshold before they can be claimed, then filing separately will result in tax savings.

It is also important to note that if wife and husband are filing separately, the same method for claiming deductions must also be used. If one itemizes, both must itemize.

Filing jointly
This type of filing is a more frequently method for married couples.
  - If there is difference in the two incomes, you have a lower tax liability.
  - There is the likelihood for the eligibility for many credits, including education and dependent-care expenses.
  - Filing one tax return instead of two is simpler.

Marriage tax penalty
Another great advantage for filing jointly is the recent reduction by legislation of the marriage tax penalty. In the past, filing a joint tax return resulted in married couples paying more than if they were to file their returns as single taxpayers.

The mind-set behind the marriage tax and standard deduction was that married couples share expenses, resulting in less expensive living costs when compared to two singles, even if the same amount of money is made. As a result, the single filers, received more generous per-person deduction.

Then there are the income tax brackets. Formerly, the income of married couples was taxed at higher rates than single taxpayers. In addition, their combined income on a joint return typically propelled them into even higher tax brackets.

The impact of marriage tax penalties have been eased as a result of tax laws that were changed in 2003. As a result, the amount of eligible standard deductions for those filing jointly is double that of single taxpayers. Also, the total of a couple's income that falls in the 15 percent bracket is double the income range of a single filer. In essence, these changes tax more of a couple's joint income as if they each were filing as single taxpayers.


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