We wouldn’t recommend getting married purely for tax benefits. But we are saying that once you find the love of your life, there’s no need to be shy to tie the knot. You and your perfect match will surely reap financial gains.
Here are five tax advantages you receive when you get married:
However unfortunate it is, a rising number of Americans are investing their money into a home or small businesses that don’t return profits; spouses of such people can use the investment loss as a tax write-off. You may not want to seek after a spouse who is losing money in a business venture. Though, it is probable that your true love may be in a similar situation someday.
Stay-at-home Spouses Can Attain an IRA
An IRA (individual retirement account) is highly recommended for those who take retirement seriously. Thankfully, a spouse who does not work can still invest and contribute to an IRA. Kevin O’Brien says, “A taxpayer who couldn’t pay into an IRA when single can use the joint income to fund one and potentially put away thousands of dollars for retirement while receiving substantial tax benefits.”
If you and your spouse gain benefit packages from your jobs, you can choose between the most valuable benefits. Turbo Tax states, “The right mixture of benefits from two plans can increase a couple’s tax savings in other ways.” Additionally, if you have dependent children, you and your spouse will benefit in using dependent care plans to cover your children.
Greater Charitable Contribution Deductions
As a single person in the eyes of the IRS, there is a limit to your charitable contributions that can be deducted. However, having a spouse can raise your limit. Libby Fay says, “If one of them makes very large charitable contributions but doesn’t have an income of at least double that amount, the excess contributions are carried over to the following year.” The higher the limit on your contributions, the greater the tax benefits will be for you and your spouse.
Marriage Protects the Estate.
If you value your estate and property — whether it be for sentimental or materialistic reasons — having a spouse can potentially preserve your estate from falling into the bank’s ownership. Turbo Tax states, “Under federal tax laws, you can leave any amount of money to a spouse without generating estate tax, so this exemption protects the deceased’s estate until the spouse dies.” If you love your spouse you might as well have the benefit of trusting him or her with your property.
Whether you owe money to the IRS or you have a State tax debt, our staff of Enrolled Agents and Tax Professionals can help you! We have over 50 years of experience negotiating with the IRS in all 50 States.