Filing Taxes After You're Married

MeaganR12

Has anyone thought about or looked into how their taxes are going to change once they get married and file jointly? Will they go up or down? 

I just thought I'd look it up real quick after reading Lady's thread and for federal taxes it looks like ours will actually go UP! How is that possible? 

Right now while we both file single, I'm in the 15% bracket and he's in the 28% bracket. If I'm reading this correctly, us filing jointly would move both of us in the 28% bracket.

Is there some married deductible I'm missing? This kinda sucks IMO.

penny12986

That is certainly something to think about if there is a big income discrepency.  FI and I are only separated by about $15,000.00 so we stay in the same bracket whether we file as single, married jointly or married separately.

This article helps spell it out.

http://www.obliviousinvestor.com/2012-tax-brackets/

ginadog

Yeah it looks like we're going from 15% and 25%, to 25% bracket jointly.

The standard deduction for married joint goes up to $11,900 I think for 2012.

We also plan to use the 2012 withholding calculator to see if we need to change our withholdings at all.

We have been maxing out several pre-tax contribution retirement accounts, which lowers your taxable income considerably.

elizabethmae315

Ooh this sounds like a nightmare. Ive never filed taxes because my parents still claim me as a dependent- so I have never had to deal with figuring it all out. Luckily my grandpa is an accountant, and he has said he will help us with figuring it all out. But based on FIs salary and my projected salary, we will pretty much be in the same no matter what I end up making. 

michelle11988

Yep, unfortunately in the great nation of the US there is a "marriage penalty" if you both earn above a certain amount the tax brackets get smaller.  Your tax bracket is based on your combined total income and the tax brackets for married people are not necessarily double the tax bracket for a single person.  Right now the tax rates are in limbo for 2012 and are expected to go back to even higher / larger marriage penalty if nothing is done in Congress.  I'm an accountant so I get this question a lot.  Definitely by maxing out 401(k) and IRA contributions can help lower your taxes.  Also going to school you get certain credits.

Madisonpenny

We already do.  I guess it's a Canadian thing.  Once you've lived together for 6 months or more and re in a relationship you file your taxes as common-law (which is equivalent to being married, or at least are supposed to file your taxes this way.)

So nothing will be changing for us other than we'll be checking the married box instead of the common-law one.

owengirl996

I have no idea...I'm so confused! lol We are both on the edge of 15%/25%...I'm still in the 15% but he pushed over into the 25% I should get a raise in June, him in March? I think, but I have no clue how much it will be...so I really can't predict very well for next year! I'm guessing it will push us into the 25%...but I guess it's not a terrible thing if it doesn't, right? lol

MeaganR12

That's interesting, Michelle. My FI is constantly complaining about how much he pays in taxes and how he gets such little deductions. Shortly after we got engaged I mentioned that his taxes would probably be lower after we got married and he said he was pretty sure it would be the opposite in our case. I pushed the thought out of my head until now but I guess he was right :-/

BmoreBride311

Well mine will be really screwy for next two years b/c I'm living and earning money outside of the U.S. It basically means I have to pay U.S. social security and medicare stuff, but no federal or state income tax (woohoo!). Of course, I am paying taxes in the UK, and their's are really high (~40%) but I don't need health insurance because of the NHS, so it works out pretty close to what I was paying in the U.S.

I know I get a tax break for being married in the UK, I guess I'll have to figure out what will happen to our taxes in the U.S. when I go back to the states sometime in 2013.

bells24412

Hmmm...I am assuming nothing changes for us. We are both in the 25% filing seperatly and when we get married we are still in the 25%. Does anything change for us Michelle?

ginadog

In Response to <a href="http://forums.theknot.com/Sites/theknot/Pages/Main.aspx/wedding-club-boards_july-2012-weddings_filing-taxes-after-married?plckFindPostKey=Cat:Wedding%20Club%20BoardsForum:066005ef-215f-48b1-8655-328b41e07c52Discussion:21559bb2-5778-41e0-9b64-4ecfdfbac089Post:d00b23c1-504c-4f2a-aa9e-ae7b5282e8f2">Re: Filing Taxes After You're Married</a>:
[QUOTE]Hmmm...I am assuming nothing changes for us. We are both in the 25% filing seperatly and when we get married we are still in the 25%. Does anything change for us Michelle?
Posted by bells24412[/QUOTE]

You'd have to look at a tax bracket table for 2012.  The single tax brackets do not equal the joint tax brackets.

michelle11988

I agree with Gina you need to look at your joint income less your standard deduction $10,600 (or itemized if they are higher aka owning a house) less your personal deduction of $3,750.  Then that is your taxable income and that could still be in the 25% bracket or not.