The first year after tying the knot has a lot of "firsts." One of the more important, but likely least exciting, is filing your first tax return. For many new couples, it's advisable to to file jointly, but there are a few circumstances under which you may decide to file separately.
Joint Filing Benefits
Deciding to file jointly may come down to the simple fact that it's sometimes just easier to file one tax return than two. For some couples, though, it goes beyond that. For example, if you and your spouse both work and one makes significantly more, filing jointly makes the most financial sense. Alone, the higher earner may get taxed more by falling into a higher tax bracket. By filing jointly, the person earning less evens the field into a more reasonable tax bracket.
If you have any concerns about what your spouse claims on his returns, you should consider filing separately. Most of time, if you're filing together, you accept equal financial responsibility for what is stated on the tax return. If any information is false or incorrect, you may get charged fees or owe more. If you keep many accounts separate, filing jointly may not be the best decision.
In some cases, you or your spouse might be able to reach the deduction threshold on only one income. If this is the case, it may make more financial sense to file separately. A caveat here is that if you file separately and itemize your deductions, your spouse usually has to as well, which may result in having to pay more. Weigh the costs and benefits of whether this would benefit your household prior to filing.
Deciding whether to file jointly or separately depends on a variety of factors. The Internal Revenue Service suggests you calculate your taxes for both joint filings and separate before you actually file. This way you can figure out which method would result in the lowest taxes. Keep in mind with separate filing, the IRS cautions that your tax rate generally will be higher than it would be on a joint return. If you do decide to file separately and later would like to change to joint status, you can always do so by using Form 1040X to file an amended return.
- TAX TIME image by brelsbil from Fotolia.com
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- How Much Do You Get Back on a Tax Return as Married Vs. Single?