“Should My Partner and I Get Married for Tax Reasons?” 3 Financial Experts Weigh In

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A little bit about myself: I work full time as a freelance writer, I share custody of my two lovely children with my former partner, my relationship with my fiancé is a dream…and my finances are a nightmare. 

That last part really hit home when tax season rolled around in April and I realized that I have failed in a pretty big way to adjust to the unique circumstances of being “self-employed.” (Translation: I got hit with a sky high tax burden and the expectation to pay estimated taxes, something I should apparently have been doing for the last few years but only just learned about.)

For two years now, I have helplessly watched my tax debt increase—a problem my fiancé and I have vowed to address as our first priority now that he’s adjusting to life in a new city and is able to start earning something, albeit not much as of yet, as a chess instructor. We also agreed to table any conversations about an actual wedding. We have a long-term engagement out of financial necessity…because who can justify a fancy dress and a honeymoon when you owe money to the IRS?

But then, I started thinking: Doesn’t getting married come with some tax-related perks? I could have sworn I heard that somewhere—so what if we just eloped now to take advantage of those and then have our dream wedding someday down the road?

Determined to get an answer to this question—one that a financially illiterate person like myself could understand—I reached out to three tax experts. The conversations I had, though downright head spinning at times, were enlightening and I learned a lot about how marriage affects the taxes of folks with a wide range of circumstances. If you too are wondering how getting hitched might affect your tax bill, read on. (Spoiler: It’s highly variable and can be a blessing or a curse, financially speaking.)

Meet the Experts:

  • Lee Reams, Sr., BSME, EA is the founder of TaxBuzz, a vertical search engine that connects taxpayers with tax and accounting professionals and provides insight on tax strategies and tips for individuals and businesses. In addition to being an expert on individual taxation and a leading speaker on tax-related topics, Lee has experience in managing his own 600+ client tax practice.
  • Crystal Stranger, EA, is author of The Small Business Tax Guide, and Partner and COO at the corporate tax and bookkeeping firm Cleer Tax
  • Eric Bronnenkant is both a CPA and a CFP, and the Head of Tax at Betterment, a financial advisory company that provides digital investment, retirement and cash management services. 

First of All, What Is the Marriage Tax?

The marriage tax isn’t an actual tax levied on married couples, but rather a term that refers to a wide range of scenarios in which married couples might find themselves with a greater tax burden than single people with the same circumstances. It’s pretty complicated, though, because the marriage tax can pop up in many different ways, though it doesn’t affect everyone. 

To better understand the “should I file jointly or separately” question, we’ve broken down some examples of marriage penalties, as well as scenarios in which marriage does indeed come with a tax break. But first there are some basic numbers you need to know regarding standard deductions (i.e., the portion of your income not subject to tax that can be used to reduce your tax bill). See the table below, and keep in mind that you may need to refer to it frequently.

When Is Marriage Advantageous for Tax Purposes?

1. When Your Spouse Makes Very, Very Little (Or Nothing at All)

Per the tax pros, there aren’t actually too many situations in which marriage comes with a tax break. Still, in some cases it can provide a little relief.

Specifically, Reams says that couples with children don’t have to worry about switching their status to Married Filing Jointly (MFJ) and losing their Head of Household (HoH) filing status (more on that later) if one person is making “very, very little money or no money at all.” Specifically, “if your spouse is making less than the difference between the HoH standard deduction and the MFJ standard deduction—so less than $6,900—then marriage will be advantageous for you,” explains Reams. (If they make right around $6,900, it will just be neutral, so in this case, less is more.) 

In fact, marriage can benefit you if your spouse has zero income, regardless of whether or not you have kids, since your deduction gets doubled with no taxable income added (i.e., a $27,700 deduction for MFJ vs. a $13,850 deduction for filing single). So, if you’re working full-time and your SO is a (self-funded) full-time student or stay-at-home parent, go ahead and get hitched and enjoy those tax benefits.

2. When You Can Offset Capital Gains and Losses

According to Bronnenkant, one winning scenario is when your combined capital gains and losses cancel out (or close to it).

Say you both have business ventures or other investments and you had a good year, bringing in $500,000 in capital gains, but your spouse, who wasn’t so lucky, ended up with $500,000 in losses for the year. In this instance, Bronnenkant explains that by being married and filing jointly you can wipe the slate clean, essentially, with a net income of $0 from your investments—meaning that you no longer have to pay taxes on the $500,000 you made. Now if you weren’t married in this same scenario, then you would have all your gains taxed and your SO’s debt would still be the same. (Note: This applies even when one person’s losses don’t entirely cancel out the other person’s gains—for example, $400,000 in losses from your spouse and $500,000 in gains from you would result in only $100,000 of taxable gains if married and filing jointly.)

When Does Marriage Come With a Tax Penalty?

Unfortunately, there are a number of ways that marriage can be disadvantageous from a tax standpoint, depending on your specific financial circumstances—and it’s probably more likely you’ll take a hit from getting hitched than not. (Reams jokes that when he was in full practice he used to tell people, “Wait! Wait! Don’t get married until January 1st.”) 

1. When Limits and Caps are No Longer In Your Favor

One issue that often comes up when thinking about filing status is that the limits and caps for married couples filing jointly may not necessarily be double what they are for single filers. One example is the tax on social security benefits, which doesn’t kick in until $25,000 for single filers, but starts at $32,000 for joint filers. 

Bronnenkant explains: “So let’s say you have two people whose income is $25,000 each, which keeps their social security benefit tax-free. Then all of a sudden, they get married…and now they have to pay tax on some of their social security benefits [specifically on $18,000]. That would be a penalty for them. Now, if there was no marriage penalty, well, then, it would kick in at $50,000 for someone who was married instead of $32,000. Then it would truly be…marriage neutral.”

Another instance in which married couples get the short end of the stick comes up with rental property. Per Stranger, “the cap for a $25,000 rental property deduction phases out at $125,000, whether you’re filing individually or jointly, so combining your incomes may result in losing that deduction.” 

And those are just a few examples—there are many other deductions that married couples may find themselves ineligible for when they file jointly, which is why it’s probably a good idea to hire an accountant to take a deep dive into the tax code for you. 

2. When You Have Kids

Stranger explains that having kids makes marriage a cost, not a benefit, in most cases. The reason for this is that by getting married, a parent loses the ability to file as HoH. Of course married couples can still claim their kids as dependents, but the HoH filing status comes with a higher standard deduction as compared to the single/married filing separately status.

In my case, this is a particularly key point because, as long as my fiance and I aren’t married, he can file his taxes as a single person and I can file as HoH, such that we get standard deductions of $13,850 and $20,800 respectively. And you don’t need a calculator to see that our combined deductions amount to more than the $27,700 we would get from the MFJ status. It’s safe to say that for any unmarried couple with children, losing the ability for one party to file as HoH is a cost, unless (as previously mentioned) your spouse makes less than the difference between the MFJ and HoH standard deductions.

What’s more, Stranger tells us that the two major credits parents receive from claiming dependents—the Earned Income Tax Credit (EITC) and the CTC (Child Tax Credit)—work on a bell curve and thus phase out very quickly as income increases. As a result, the combined income on a MFJ return would most likely reduce or completely remove any benefit from those credits, unless one person isn’t making any income at all.

To summarize, “if you don’t have kids, there’s much less of a tax cost from getting married,” says Stranger. And if you do have children with a spouse, they likely give you many blessings…but tax benefits are not one of them. 

The Takeaway

News to no one: Taxes are complicated as hell. Or as Reams put it to me, “I hope you’re beginning to understand that there are infinite scenarios. That’s the problem here.” Noted.

For that reason, and rather unsurprisingly, all the experts agree that it’s usually wise to enlist the help of a professional when trying to figure out how marriage will affect your finances. If you’re debating tying the knot all in the name of the IRS, your best bet is to sit down and prepare three separate tax returns: One for your future spouse as a single person and one for you as a single person (or HoH, if that applies), plus one for the two of you if you were to tie the knot and file jointly. That’s what I’m going to do, at least…but probably not for a little while, since it appears that I’ll benefit most from wearing my HoH status like a badge of honor for a little while longer and, you know…taxes. 

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