Tax Advice for Newlyweds
Everyone has advice for newlyweds. Get a large refrigerator, prepare a budget, and never go to bed angry. But who would have imagined that the Internal Revenue Service would chime in with its own good thoughts?
If one or both of you changed your name after marrying, you must let the Social Security Administration know by updating your Social Security card. Your name must match your social number in order to claim personal exemptions or the Earned Income Tax Credit on your tax return.
Change of Address
If you have moved since your marriage, you should notify the post office so that you can receive not only any late wedding gifts but also any correspondence from the IRS. It is amazing how many tax refund checks are returned to the IRS as undeliverable, usually because the taxpayer has moved and failed to change his address.
The U.S. Postal Service will automatically give your new address to the IRS, but a taxpayer can inform the IRS directly by either filling out a form or by writing to the IRS center where the most recent return was filed. The IRS needs your full name, old and new addresses, social security number, and signature in order to process the change.
In addition, you should give any new name and address information to your employer so that your end-of-year wage information (Form W-2) will be sent to the right place.
Correct Form and Filing Status
Your marital status is determined on the last day of the year, so if you were married on December 31, the IRS considers you to have been married for the entire year.
Now that you are married, there is a whole new world of finances out there. As a married person, you must decide whether to file a joint or separate tax return in order to pay the least amount of taxes. If you file a joint return, you and your spouse will combine all items of income and expense on one return. Generally, this is the most advantageous way for married couples to file. Both parties must sign the return, and they are both responsible for its contents.
If you decide to file separate tax returns, you are only responsible for the contents of your own return. You are taxed on your own income, and you can only take your own deductions. If one spouse itemizes deductions, the other must also itemize.
The best way to decide whether to file a joint or separate return is to calculate the tax both ways.
Newly married taxpayers may find that they now, for the first time, have enough medical expenses, mortgage interest, contributions, casualty losses, and other miscellaneous expenses to itemize deductions instead of taking a standard deduction. If you filed a simplified tax return in prior years, you must file a regular Form 1040 in order to take advantage of any tax benefit from itemizing deductions.
If you filed a simplified form last year, you may not get all the forms you need as a married person in the tax package mailed to you by the IRS. Any form you may need is available on-line or in a local IRS office.