How Newlyweds Should Decide on The Biggest Tax Question of Their Marriage

PHOTO: Newly married couples may want to file their taxes jointly.

Tax season is now over and wedding season is underway. So what if you're recently married (or soon to be married) and you're already thinking about taxes for next year? Do you know if you want to file together or separately? While filing jointly is commonly considered the best way to go, there are a few things to think about before you choose. Let's talk about your options so you can make an informed decision.

Married Filing Jointly

If you're newly married, then chances are you may want to do everything jointly. And there absolutely are benefits to filing your taxes jointly, but remember it doesn't mean you have to combine your finances to do so. There are some factors that you'll benefit from if you file together.

You can contribute to an individual retirement account, even if you don't have taxable income.


You can benefit from your spouse's tax deductions.

Don't have student loans, but your spouse does? By filing jointly that deduction is factored into your joint return. The same goes with charitable tax deductions and you can even deduct more than you could if you filed separately. Finally, if your spouse has medical bills or other such expenses, you could likely claim those together, when you wouldn't be able to claim them if you were filing separately.

You are exempt from estate taxes and gift taxes.

In an effort to prevent the very wealthy from evading taxes by giving large gifts to family members and loved ones, the government charges estate and gift taxes. However, if your spouse is wealthy and passes away, you won't be charged estate taxes if you filed taxes jointly. The same goes with gifts that your spouse gives.

Wild Card: Tax Brackets


Married Filing Separately


You won't be liable for your spouse's tax mistakes and financial woes.

One clear benefit to filing separately is that, if your spouse makes a mistake on his or her taxes, you won't be liable for this. The same goes for your spouse's financial woes. If your spouse is facing garnished wages and you filed jointly, then you could end up not getting a refund. But if you filed separately, then you're not at risk.

Wild Card: Tax Brackets

This was mentioned above, but should be reiterated. It is possible that your spouse's earning could put you in a higher tax bracket, thus exposing you to higher taxable income. If you're filing separately however, this won't be an issue for you. Talk to a professional to crunch the numbers before making a decision based on tax brackets.

Something to consider: You must file the same way.

If you and your spouse file separately, you still have to file taxes in the same way. That means if your spouse itemizes, so must you. If your spouse goes with the standard deductions, you'll have to do the same. That means that you still have to be on the same page with how to file taxes -- so if you were filing separately because of a disagreement on how to file, then this won't help you.

Potential Con: You're not eligible for your spouse's deductions

If your spouse is taking deductions such as the student loan interest deduction, then you won't be able to benefit from these deductions if you file separately. This could end up costing you money as a couple if the deductions taken off a joint return could result in greater savings.

Conventional wisdom veers toward advising married couples to file their taxes jointly. However, everyone has a totally unique situation, so it's best not to adhere solely to conventional wisdom. Weigh the pros and cons, talk to your spouse, and seek the help of a financial professional at least once before you decide. That way you can know for sure that you're making the right decision for yourself and for each other.


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