Marriage and the tax penalty.
March 7, 2014 4:47 PM Subscribe
Should we get married this year, or will that end up in a tax penalty, considering our incomes are similar and we would end up in a higher tax bracket?
posted by anonymous to Law & Government (14 answers total) 5 users marked this as a favorite
We are considering getting married this year, but first we decided to look at how that would affect our taxes.
Married filing jointly would put us in the higher tax bracket, which means we pay ~$4000 more per year, jointly. Married filing separately would also put one of us in the higher tax bracket - not by much, but still. Being single, we can continue enjoying our lower tax bracket for another ~5-10 years, based on our annual salary increases. But I am wondering if I am missing something here, because why would people in our situation ever get married*?
Is there some kind of marriage credit that I am not taking into account? Also, he is on the mortgage for his mom's house, so he gets a lot more money back every year thanks to interest/property taxes. Would that affect us tax-wise if we got married?
*I realize that there are other benefits to getting married, but they do not apply to us right now (no plans of kids, house buying, or dying). We can really go either way as far as when to get married - it would be nice to be officially married this year from a sentimental point of view, but not if it costs us money! We can wait a few years until we need the other marriage/legal benefits if this is the case.
If this is a question for a CPA, then we will go to one, but first I wanted to find out if we are mis-interpreting something from our googling, or if this is a pretty standard problem for people in the middle-top of the $36,251 - $87,850 single income bracket.