The summer wedding season is well underway, and the Internal Revenue Service thought it would be nice to give a little advice to those of you who recently said “I do.” If you -- or your clients -- follow these seven tips, you will likely have an easier time when tax season rolls around.
1. Notify the Social Security Administration. Report any name change to the Social Security Administration so your name and Social Security number will match when you file your next tax return. File a Form SS-5, Application for a Social Security Card, at your local SSA office. The form is available on SSA’s website at www.ssa.gov, by calling (800) 772-1213 or at local offices.
2. Notify the IRS if you move. If you have a new address you should notify the IRS by sending Form 8822, Change of Address. You may download Form 8822 from www.IRS.gov or order it by calling (800) 829–3676.
3. Notify the U.S. Postal Service. You should also notify the U.S. Postal Service when you move, so it can forward any IRS correspondence or refunds.
4. Notify your employer. Report any name and address changes to your employer(s) to make sure you receive your Form W-2, Wage and Tax Statement, after the end of the year.
5. Check your withholding. If both you and your spouse work, your combined income may place you in a higher tax bracket. You can use the IRS Withholding Calculator available on www.irs.gov to assist you in determining the correct amount of withholding needed for your new filing status. The IRS Withholding Calculator will give you the information you need to complete a new Form W-4, Employee's Withholding Allowance Certificate. You can fill it out and print it online and then give the form to your employer(s) so they withhold the correct amount from your pay.
6. Select the right tax form. Choosing the right individual income tax form can help save money. Newly married taxpayers may find that they now have enough deductions to itemize on their tax returns. Itemized deductions must be claimed on a Form 1040, not a 1040A or 1040EZ.
7. Choose the best filing status. A person’s marital status on December 31 determines whether the person is considered married for that year. Generally, the tax law allows married couples to choose to file their federal income tax return either jointly or separately in any given year. Figuring the tax both ways can determine which filing status will result in the lowest tax, but usually filing jointly is more beneficial.
1 Comment
It Ain't Necessarily So: tax tips rebuttal from a 42-year veteran
Tip #1) Do not change your name with Social Security too close to tax season. Because of the delay in data-sharing between SSA and IRS, you might want to stick with your maiden name until AFTER the refund check has been cashed. (Changing your name for ANY reason after October is problematic).
Tip #4) Most Post Offices refuse to forward refund checks for any reason. If you still haven't gotten your refunds, you should call both the IRS and your state. They have destroyed the returned checks, and will issue you new ones if you prove that the old address on your return is no longer valid. (Just go for electronic direct deposit - problem solved).
Tip #7) MFJ is seldom better in states with huge marriage penalties built in to the tax code, like Ohio. Only if your federal credits outweigh your state penalties should you go joint. Always optimize and proceed with caution in certain states. (Another reason NOT to go out-of-state for your return - the preparers lack of familiarity with your home state's marriage penalties might result in a less-than-optimal combined refund amount).
Kate Harner, EA
Posted by: KATEHARNER | August 23, 2012 2:18 PM
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