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The IRS gives major tax benefits to married couples. Be
sure to go through the list below to ensure you are taking all the deduction you can before you
file your taxes this year.
1. Your Tax Bracket Could Be Lower Jointly
For years, taxpayers complained about the marriage penalty, which used to occur when
spouses who made similar salaries, when united, pushed their taxable income to some greater
tax bracket than if they were single. Congress took steps to reduce that penalty, making the tax
bill for married couples filing jointly closer to the joint total they would have owed as single
citizens. But if the taxpaying spouses have different wages, the lower one can pull on down the
one that is greater to a lower bracket, reducing their overall taxes.
2. Your Partner May Be A Tax Shelter
It is well worth noting that both spouses can be helped by the negative numbers of one person
in a union or marriage. The partner who is losing money - say, in business - may not be able
to make the most of some deductions, including those dealing with the home. This person could
be able to take these newfound tax deductions and maintain the other's loss on a return as a tax
write-off.
3. Jobless Spouse Can Have An IRA
A taxpayer with no employment may contribute to an IRA using joint earnings. Eligible couples
filing jointly can make contributions to two separate IRA accounts - one for each spouse -
and get substantial tax advantages. Even when a couple is not eligible for some tax-deductible
IRA contribution because of income limits, both spouses might have the ability to make non-
deductible IRA gifts.
4. Couples May "Benefit-Shop"
They could usually pick on the most valuable benefits from the two plans if both partners have
benefit packages from their tasks. Frequently, benefits vary between spouses and a couple's
tax savings can be increased by the combination of benefits from two plans. By way of example,
a few with dependents may make the most of one spouse's dependent care flexible spending
account (FSA) that directly enriches their taxable income.
5. Married Couples Get Greater Charitable Contribution Deductions
There is a limitation to the charitable gifts which could be deducted based on income, which is
no more than 50% of your earnings. That limit can be raised by having a partner. If one spouse
doesn't have an income of at least twice the number of their charitable contributions in one year,
the excess contributions are carried over to another calendar year. However, for couples filing
jointly, the deduction sum takes the income of another spouse into consideration, so they can
deduct a greater amount.
6. Marriage Can Protect The Estate
Being married can help a wealthy person protect the assets they leave behind. Under federal
tax laws, you can leave any amount of money to a spouse without generating estate tax, so this
exemption can usually protect the deceased's estate from taxation until the surviving spouse
dies.
7. Take Full Advantage Of This Major Homeowner Tax Deductions
Owning a home can be very lucrative. Owning a home can not only give you a possibly cheaper
monthly payment than renting, but in many cases, the tax benefits are in your favor.
8. Interest you pay on your mortgage
If you own a home and don't have a mortgage greater than $750,000, you can deduct the
interest you pay on the loan. This is one of the biggest benefits to owning a home versus
renting-as you could get massive deductions at tax time. However, if you deduct interest, you
will forgo the standard deduction of $12,000 for individuals or married couples filing individually,
$18,000 for head of household and $24,000 for married filing jointly. Many people are choosing
to take the standard deduction now since it is so much higher than it used to be.
This information is of a general nature and should not be acted upon without further details
and/or professional guidance. If you would like to learn more about Cole, Newton & Duran CPAs
and how we can help with your accounting, tax, or consulting needs, please contact Bryan
Besco, client relationship director, at 734.427.2030.
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Congresswoman Haley Stevens (MI-11) sent a letter to United States Secretary of Commerce Wilbur Ross, calling for the creation of an interagency task force to address the economic ramifications of the coronavirus epidemic. In the letter, Congresswoman Stevens raised concerns about supply chain disruption related to the coronavirus and the negative impact on small and mid-sized manufacturers in the United States. According to the Wall Street Journal, economists are warning that an extended Chinese shutdown could cripple global manufacturing and cost the world up to $1 trillion in lost output.
Euchre Card Party to support Clarenceville 2020 Grads is set for March 21st at the VFW Hall, Schoolcraft and Inkster.
Looking for someone to cater your graduation party? Or perhaps that business meeting.
Our Trivia Night is on April 24th. We are starting to gather items for our raffle at the event. If you or a business would like to donate something, we would be most appreciative.
