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Advantages and Disadvantages for Married Couples Filing Jointly

Advantages and Disadvantages for Married Couples Filing Jointly

One of the challenges that married couples face is determining the best way to file their taxes each year. Until recently, couples who were married filing jointly would often receive significantly lower tax returns because there combined incomes would push them into a different tax bracket. Changes in the tax laws have helped ease this particular burden, but it still leaves the question of what are the advantages and disadvantages for married couples filing jointly.

Advantages

The primary advantage for couples that choose to file jointly is that the threshold for receiving specific types of tax credits is higher. Each couple is able to receive two exemptions based on their income and qualifications. The most important of these is the Earned Income Tax Credit (EITC) which helped offset Social Security taxes, and gives filers a chance to receive more money back than they paid in on their taxes. According to tax and finance-giant, Intuit, this is one of the most overlooked tax exemptions which can benefit low to middle class Americans. Intuit also explains that filing separately can actually lead to fewer tax considerations. In 2015, couples who file jointly received an average of twice the amount in their tax return as those who filed separately.

Disadvantages

For most couples, it makes sense to file jointly on their tax return. However, if one person has experienced a large number of medical bills, for example, then filing jointly can actually decrease their ability to claim this expense as a deduction. Choosing to file your taxes jointly also means that both parties are taking responsibility for any tax liability of the other person. This means that if your spouse has delinquent debts, then you are also obligated to pay them. The IRS also limits the number of miscellaneous deductions which couples married filing jointly can claim. For most couples this is an issue, but depending on your lifestyle and the type of expenses you have incurred in the past tax year, this may become an issue for you.

Most tax experts agree that it is financially advantageous for couples to file jointly. However, your unique situation will depend on the type of income level between you and your spouse, whether or not you have children, whether or not you have incurred a substantial amount of debt, and any major expenses which have been made during the last year. While the process of filing your taxes can be done quickly and easily online, it is always recommended that if you have any questions you reach out to a tax expert for help. These professionals know the tax laws in and out and can help you receive the highest return by ensuring that all deductions and credits which you qualified for as a married couple are received.

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