Are wedding bells in your future this summer?
If so, add tax updates to the long list of things to do. It's not very exciting, but you should at least take care of some paperwork to keep your tax situation in order.
The good news is that your overall tax burden may not change a lot. Until a few years ago, you were likely to suffer a marriage penalty if you both worked. That meant that you paid more taxes as a married couple than your combined taxes as singles.
Congress has now largely removed the penalty, at least for low and middle-income earners. Now you're not likely to feel a penalty until your combined income exceeds about $124,000.
This varies with your personal circumstances though. You might want to check with your tax adviser and see whether you need to adjust your payroll withholding.
You should also do some other things to adjust your taxes and finances to your new married status.
- Notify the Social Security Administration if you change your name.
- Notify the IRS of your address change if you move to a new home. This ensures that any correspondence about previous returns or refunds will find you.
- File new Forms W-4 at work to reflect your married status.
- Review your combined contributions to 401(k) plans to make sure you're maximizing your company's matching contribution.
- Don't overlook estate tax planning. Draw up a new estate plan with wills, powers-of-attorney, health care directives, etc.
- Review the beneficiary designations on your IRAs and insurance policies.
Please contact our office if we can help with any of these items.
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