Do you know what the number one month is for weddings? Check today’s date and there it is: June.
With that fact in mind, I’m not sure where you currently fall on the wedding spectrum…
Are many of your friends getting married? Are your friends’ kids getting married? And if you or someone close to you is getting married soon, congratulations! Weddings are a huge deal (for obvious reasons) and, as a bonus, can often act as mini “family reunions” to gather with loved ones.
But, once the dust has settled…
And the honeymoon is over and the boxes are unpacked and the thank you’s have all been written, there are some tax implications for the newlyweds in your life. Marriage and taxes may not be the most exciting topic, but messing up your taxes is not fun either.So whether the following tips are useful for you personally, or something you can forward to others, there’s no reason these tax changes should damper anyone’s newlywed bliss.
Key Tips For Dallas/Fort Worth Newlyweds On Marriage and Taxes
“A successful marriage requires falling in love many times, always with the same person.” -Mignon McLaughlin
Perhaps the most obvious change after the big day is a new surname for one or both parties. If that’s the case, then it’s imperative the person changing their last name reports it to the Social Security Administration.
This is key because, during filing season, the IRS will look to the SSA for your personal data, and if the new surname is not accounted for, your tax refund will be delayed.
A change in marital status will also directly affect your filing status with your Dallas/Fort Worth employer. Make sure you connect with HR at work to adjust your workplace withholding. Failing to do so may result in inaccurate payments from each paycheck, which may mean an unexpected tax bill come filing time.
New Home. New Status.
Upon marriage, there is usually at least one party who has a change of address. In addition to notifying the post office of the change, it’s important the IRS knows the address change occurred as well. The reason being, so that they can mail any important documents to the right address moving forward.
As married couples think about the tax year ahead, it’s their marital status on December 31st which will determine how they file — jointly or separately.
This is where I step in to help many newlyweds determine which is the right filing status for them. Figuring out marital tax implications is tricky enough as it is, so I don’t recommend doing it all alone.
Reassessing healthcare options is another key change that accompanies newlywed tax status. The move requires a proactive attitude, as it’s not necessarily fun stuff to change. But it will make a difference when one least expects it.
Although I’m no marriage expert, I know marriage usually comes with plenty of unexpected twists and turns.
If you’re insured through the Affordable Care Act (ACA), you might qualify for the premium tax credit. And if that’s the case, a change in marital status will affect the credit you receive.
Again, reconfiguring healthcare, and the tax implications as a result, is one more (tricky) area I’d love to help you or someone you know navigate in the future.
With all that being said … marriage is a joyous occasion (with many logistics to follow). Many couples out there don’t see the tax ramifications as a fun new change, but there are some, like me, who love to explore how to maximize its benefits.
Even though June is great for weddings, we all know April is when things really heat up.
Let’s start planning for that dance ASAP.
Timothy A. Phillips, CPA, PC