This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

For Newlyweds, Arguments For and Against Filing Taxes Jointly

NEW YORK -- ( MainStreet) -- So you got married in 2011? That's great, but the Internal Revenue Service doesn't have all year for you and your spouse to decide how you'll file your taxes.

There is one basic truth for newlyweds during tax season: Whatever your marital status was Dec. 31 is what the IRS considers you for all of 2011. From there it gets a bit more complicated.

Joint tax filing is usually the best way to go, but medical bills and "risky spouses" can get in the way.

A married couple's first kiss after taking their vows essentially kisses both of their "single" tax filing statuses goodbye. From here on in, they're left with two options: married filing jointly and married filing separately. The former generally results in the lightest tax hit by giving couples a few breaks, including a credit for child- and dependent-care expenses, deductions for student loan interest and a lifetime learning credit. This wasn't always the case, but George W. Bush's tax cuts in 2001 and the Tax Relief Act in 2010 helped expand the lower tax brackets for joint filers and make it a bit easier on big earners and their low-earning spouses.

"Historically, two singles cohabiting would pay less than a married couple, but that was changed with the Marriage Penalty Relief Act," says David B. White, certified public accountant and president and founder of David B. White Financial in Bloomfield Hills, Mich. "Generally speaking, married filing jointly is going to be lower than married filing separately, especially if there's an imbalance of earnings where you would forfeit expenses and deductions for the person who doesn't have much income."

A couple's tax decision also has a great effect on their plans for retirement savings. When a couple files jointly and one spouse isn't working, the working spouse can make a contribution for the nonworking spouse that wouldn't be allowed if they're filing separately. Also, the $10,000 limit on Roth IRA contributions for those filing separately is much lower than it is for joint filers.

1 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs