Saturday, October 31, 2009

What should I do, take the Marriage Tax Credit and/or Penalty, or file bymyself?

My GF and i are thinking of getting married at dec, one of the reasons is for this tax credit.



We make the same around 50k each. we have no kids, good credit, no past taxes due, we both normally get refunds by ourselves, we both claim single 0. should get file spearate or jointly?



What should I do, take the Marriage Tax Credit and/or Penalty, or file bymyself?

With only the standard deduction and exemption, a single or MFS person making $50,000 of income is going to pay $6,736 of income tax. So times two, $13,472.



A married couple making $100,000, with the standard deduction and two exemptions, pays exactly the same tax, or $13,472.



So it probably makes no difference if you marry or not this year as far as your taxes are concerned. If one of you itemized and the other didn%26#039;t, and now you can itemize on a joint return, that could be a tax savings.



What should I do, take the Marriage Tax Credit and/or Penalty, or file bymyself?

if you get married by 12/31/2007, file jointly and take advantage of the joint filing rates - you%26#039;ll save money.



What should I do, take the Marriage Tax Credit and/or Penalty, or file bymyself?

If you marry in 2007, then you can either file a joint return or each can file as %26quot;married filing separately.%26quot; Usually the joint return results in less total tax but you can easily run the numbers both ways.



What should I do, take the Marriage Tax Credit and/or Penalty, or file bymyself?

What tax credit are you talking about? There isn%26#039;t a marriage tax credit. Since you both make about the same amount, your taxes in total will end up the same either way if you file a joint return if you get married before the end of the year - filing as married filing separately would cost you extra.



What should I do, take the Marriage Tax Credit and/or Penalty, or file bymyself?

There%26#039;s no such thing as the %26quot;Marriage Tax Credit%26quot; so that won%26#039;t figure into your decision.



And frankly in your tax situation it won%26#039;t make much difference at all tax-wise since your incomes are nearly identical. You%26#039;ll most likely pay the same total tax if you remain single as you%26#039;ll pay either filing Married Filing Jointly or Married Filing Separately.



If you are eligible for any tax credits such as educational credits then you%26#039;ll do better with a joint return vs separate returns if you%26#039;re married but it will be a wash if you remain single.



What should I do, take the Marriage Tax Credit and/or Penalty, or file bymyself?

Married filing separately in a lot situations is the least desirable filing status to use. Married filing Jointly is the best way for most people. Do it both ways and you will see for yourself. I bet it will be %26quot;married filing jointly%26quot;. Do not forget your state taxes as well.

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