Generally, married filing jointly provides the most beneficial tax outcome for most couples because some deductions and credits are reduced or not available to married couples filing separate returns.
Studies have shown that married couples are often more financially secure than singles. If you are not inclined to have kids, then marry someone else who feels the same. That will avoid one source of tension in a marriage. Two married people can live on less than if the two were single and not living together.
In most cases, you will get a bigger refund or a lower tax bill if you file jointly with your spouse. There are a few situations in which filing separately can be more advantageous, including when one spouse has significant miscellaneous deductions or medical expenses.
Married couples filing jointly may qualify for several tax credits they would not have if they filed separately, including the Earned Income Tax Credit, Child and Dependent Care Tax Credit, and American Opportunity and Lifetime Learning Education Tax Credits.
If you get Social Security disability or retirement benefits and you marry, your benefit will stay the same. However, other benefits such as SSI, Survivors, Divorced Spouses, and Child's benefits may be affected.
For married couples filing jointly, the standard deduction rises to $30,000, an increase of $800 from tax year 2024. For heads of households, the standard deduction will be $22,500 for tax year 2025, an increase of $600 from the amount for tax year 2024.
Marriage can offer significant financial benefits such as pooled resources for retirement, access to spousal Social Security benefits, insurance coverage and discounts, and potential tax advantages. Financial planning for couples before marriage is crucial to avoid future conflict and align shared goals.
There are several situations in which a couple should file separately. These include divorce or separation, issues with liability, the repayment of student loans, or different pay scales.
Marriage could expose you to each other's creditors, insurance risks (health care, home, and auto), higher income tax rates, and long-term care costs. Marriage could make you financially responsible for your spouse's dependent children.
A couple pays a “marriage penalty” if the partners pay more income tax as a married couple than they would pay as unmarried individuals. Conversely, the couple receives a “marriage bonus” if the partners pay less income tax as a married couple than they would pay as unmarried individuals.
The research seems clear that even if marriage benefits both men and women, there is more of an upside for men. Men derive greater health benefits from marriage than women. Married fathers receive an earnings boost while mothers receive a penalty. Women are disproportionately likely to end marriages.
Your tax bracket could be lower together
Depending on the incomes, there still can be a marriage penalty. But if the taxpaying spouses have substantially different salaries, the lower one can pull the higher one down into a lower bracket, reducing their overall taxes.
Your personal relationship status does have an impact on what you pay for car insurance. Because married drivers are seen as more financially stable and safer drivers, they typically pay less for car insurance.
A couple incurs a marriage penalty if a couple pays more income tax filing as a married couple than the two of them would pay if they were single and filed as individuals. Conversely, a couple receives a marriage bonus if they pay less tax filing as a couple than the two of them would pay if they were single.
Your full spouse's benefit could be up to one-half the amount your spouse is eligible to receive at their full retirement age. If you choose to receive your spouse's benefits before you reach full retirement age, your payment will be permanently reduced.
Higher standard deduction
The filing status you choose will have implications for your income tax bracket and for your standard deduction. For tax year 2024, the standard deduction is $14,600 for single filers, $29,200 for married couples filing jointly, and $21,900 for heads of households.
Marriage really is more than having a loving companion who supports and cares for you. A satisfying relationship can actually help to be physically and mentally healthier. Not only does marriage give a safe space to grow, it also enhances individual well-being.
In some cases, married couples actually get a marriage bonus. This means they pay less income tax as a married couple than they would if they stayed single.
The standard deduction for taxpayers who do not itemize deductions on Form 1040, Schedule A, has increased. The standard deduction amounts for 2024 are: $29,200 – Married Filing Jointly or Qualifying Surviving Spouse (increase of $1,500) $21,900 – Head of Household (increase of $1,100)
Single people, while more physically active, have poorer diets than married people. Married people also have built-in social and emotional support in each other, are less likely to participate in risky behaviours (such as problem drinking) and have better economic conditions compared to single people.
Marriage has its perks
Social Security covers both spouses, regardless of whether one or both brought home a paycheck over the years. A married person may collect benefits based on their own earnings or receive a maximum of 50% of their spouse's Social Security benefits, whichever is greater.
The disadvantages of marriage include high divorce rates, marriage dissatisfaction, and financial strain that may occur from overspending or the high costs of raising children.