Everyone knows throwing a wedding can cost you a pretty penny. But not many know about the taxes that come along with every marriage. Here are some quick tips to assist you with your marriage planning this summer:
If you change your last name as a result of a marriage, you must report it to the Social Security Administration (SSA). Your tax return must have the accurate names and Social Security numbers and match the records with the SSA. To report a name change, you can file the Application for a Social Security Card, Form SS-5, here.
Tax Withholding Changes
When there is a change in your marital status, you must fill out a new Form W-4, Employee’s Withholding Allowance Certificate, and give to your employer. If both you and your spouse are employed, the combined incomes may move you up to a higher tax bracket or you can be potentially affected by the Additional Medicare Tax.
If you and your spouse obtained a Health Insurance Marketplace plan and acquired advance payments of the premium tax credit this year, it is critical that you notify any changes in family size or income to the Marketplace. If you happen to be moving out of the area you’re listed in on your present Marketplace plan, you should also report these changes. Advance tax credit payments are paid to your insurance company to minimize the out-of-pocket costs for health insurance premiums. Disclosing any changes now will aid you in avoiding receiving too little or too much in advance, which can affect your balance due or refund when filing tax returns.
If you change your address, you must notify the IRS by sending Form 8822. Something most people forget to do when they move is notify the U.S. Postal Service to forward their mail to the new address. You can do so by going online at USPS.com or go to your local post office and requesting that action. In addition, you should also report any address change to the Health Insurance Marketplace if you are relocating out of the area covered in your present health care plan.
Tax Filing Status
If you marry by December 31st, that will be your marital status for the entire year for tax means. You can opt to file your federal income tax return jointly or separately every year.
Choosing the Appropriate Tax Form
Selecting the correct income tax form can help you save money. Newlyweds may discover that they have sufficient deductions to itemize on tax returns. These itemized deductions can be claimed on Form 1040.