Has your marriage status recently changed? Changing your marital status is a significant life event that also impacts your tax responsibilities. Whether you’re newly married or have experienced another change in your marital status, here are five essential tax tips to ensure you do your taxes effectively:
Update Your Filing Status
Choosing the Best Filing Option: Once married, you can file taxes: “Married Filing Jointly” or “Married Filing Separately.” Filing jointly typically provides more benefits, such as higher income thresholds for tax brackets and access to various tax credits and deductions. This can lead to substantial tax savings. However, in some specific situations, such as when one spouse has significant deductible expenses (medical bills, etc.), filing separately might prove advantageous.
Adjust Your Withholding
Modify Your W-4 to Reflect Marriage: Your marital status affects the amount of taxes withheld from your paycheck. Failing to adjust your W-4 form post-marriage can result in incorrect withholdings, either leading to a large tax bill at year’s end or a smaller-than-expected refund. Couples with dual incomes should be particularly careful to adjust their withholdings to account for the combined income potentially pushing them into a higher tax bracket.
Review Your Financial Assets
Consolidation and Beneficiaries: Combining finances is a common step after marriage. It’s crucial to update the beneficiaries on all pertinent accounts including life insurance, retirement accounts, and annuities. Additionally, evaluate whether consolidating bank accounts or opening new joint accounts will support your shared financial goals and responsibilities.
Understand Tax Breaks
Leverage Available Deductions and Credits: Marriage can unlock a range of tax benefits that were unavailable or less effective when filing singly. Key considerations include whether to itemize or take the standard deduction based on your combined expenses and income. Categories such as charitable donations, home mortgage interest, and education costs can significantly influence your decision. Also, explore credits for which you might now qualify, such as the Earned Income Tax Credit or Child Tax Credit, if applicable.
Plan for the Future
Strategic Long-term Financial Planning: With marriage comes the need for more comprehensive financial planning. Discuss retirement strategies and consider how you might need to adjust contributions to retirement plans. Estate planning also becomes essential, as you’ll need to decide how to best manage and protect your joint assets. Consulting with a tax professional can provide personalized advice tailored to your specific circumstances.
How Local Tax Can Assist With Your Taxes After Your Marriage Status Has Changed
Expert Tax Services for Personal and Business Needs: At Local Tax, located at 9429 Somerset Blvd, Bellflower, CA 90706, we specialize in providing expert tax services for both personal and business needs. Whether you’re facing complexities from a change in marital status or need regular tax planning advice, our team is here to assist you. We offer a comprehensive range of services, including tax preparation, filing, and planning, ensuring you maximize your deductions and credits. Our office is open year-round, allowing us to support you beyond the typical tax season and address any questions or concerns as they arise.
For personalized service, visit us or call 562-925-2203 to schedule a consultation. Our experts are ready to help you navigate every aspect of your tax situation, ensuring compliance and optimizing your financial health.
