Getting Married? 3 Tax Adjustments That You Will Need to Make

July 29, 2011 by  Filed under: Taxes 

Marriage is a significant step in the lives of many people. The prospects of sharing one’s life, starting a family, and all the other joys of marriage are all worth looking forward to. However, besides the regular adjustments of marriage, getting hitched also comes with significant tax implications. There are also several tax adjustments that you will need to undertake, now that you are married. Below are 3 things that you may need to do to be better prepared for your taxes in your new married status:

1. Understand the Tax Implications of Your Marriage

An important step that anyone seeking to get married should undertake is to carefully review the implications of the marriage to their taxes. This is especially so if you are planning to file your taxes jointly with your spouse. Filing jointly can have different tax consequences. Some couples end up paying more taxes while others end up paying less. You will therefore, need to carry out estimates to know whether to file your taxes jointly or separately, depending on which option has more advantages. Besides the tax amount, filing jointly also comes with a range of tax relief opportunities that you can capitalize on. If you are already claiming various tax credits or deductions, the threshold, caps and application of these tax reliefs will in most cases, change because of the change of your marital status. Given the extent of the tax changes that comes with getting married, it may be advisable to consult with a professional once you are married so as to properly plan your taxes.

2. Make the Relevant Adjustments

Once you have reviewed the tax implication of your marriage and have determined whether you will file jointly or separately, you will then need to make various adjustments relating to your tax information. If your names have changed – for a married woman who takes her husband’s name – you will need to change your name with the Social Security Administration. This will ensure that your Social Security number will match correctly with your new name as you file your future returns. To file the name adjustment, you can download an Application for a Social Security Card form from the Social Security Administration website and indicate the changes. You can then forward the form to the Social Security Administration Office.

You will also need to change your address details if you have moved to a new place for either of the spouses. To make changes to your address in your tax records, you will need to download a Form 8822 “Change of Address Form” from the IRS website and fill it out with the new details. You should also makes address changes with other tax agents, including employers and companies that send dividends and other distributions so as to receive the relevant tax support documentation.

3. Adjust Your Withholding Tax

Since marriage comes with significant tax changes, it is important that you make adjustments to your withholdings once you are married. If you do not adjust your withholding tax, you may end up with a huge tax refund or you may need to pay a huge tax bill during tax season. Therefore, after reviewing the tax implications of your marriage, ensure that you make the relevant withholding tax changes with your employer by submitting a new Form W-4 to ensure that the correct tax installments are getting paid.

Rob L Daniel and partners of Limon Whitaker & Morgan, for years have helped businesses and individuals Nationwide, with their delinquent IRS & State tax problems. The firm is based in Los Angeles, California USA.

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