To Have and To Hold

Are there Tax Implications when getting Married? 

The wedding bells have rung, and now it is official!  The bliss may be a little short-lived, however, when couples go to file their annual tax returns. They may discover they actually pay more in taxes than they would if they were single.  You may have heard the term "marriage penalty."  This so-called penalty has been embedded in the U.S. tax code for a long time.  The simple math is that the married filing joint income thresholds for the higher tax brackets are NOT double the amount for single.

On top of that, the new tax increases and additional taxes implemented in 2013 have the potential to hit married couples harder; especially if they both earn high salaries and/or have investment income.  Also, married couples in higher tax brackets will find the phaseout of personal exemptions and itemized deductions are lower, resulting in higher taxes.   Rarely does married filing separate offer any relief; and in community property states it is nearly impossible to legally file separately. Reviewing all the options with us will be pivotal to your tax strategy.

It is also helpful to review your income and withholding throughout the year while there is time to make adjustments to avoid surprises at tax time.

Oh, and by the way, if you get married on December 31, you are considered married for the tax year.