Filing taxes can be a daunting task for anyone. There areso many things to consider: Whatdeductions should I take, how should I file, etc.? The list goes on and on, andwithout the proper guidance, you could be cheating yourself. This is especiallytrue for same-sex couples. The U.S. Department of the Treasury and the InternalRevenue Service ruled that same-sex couples, legally married in jurisdictionsthat recognize their marriages, will be treated as married for federal taxpurposes.
Legalizing same-sex marriage had some major practicalimplications for same-sex couples. Domestic partnerships and civil unions,although counted as legal relationships that are recognized on the state level,are not marriages and don’t qualify you to file federal taxes as a marriedcouple. You can only file using the marriage designation if you are legallymarried.
For most married same-sex couples, they are likely to see alower tax bill as a result for being able to file as married. However, those onthe extreme ends of the income spectrum should know that this may not be truefor them. Their tax liability may go up. It is important to consult anexperienced tax preparer who understands the laws and can guide you through theprocess. For example, for couples who both have high-income earnings, they maysee their tax bill increase if they file jointly. If so, they should considerfiling separately. Married couples can file federal taxes in two ways – marriedfiling jointly or married filing separately.
Couples who plan on raising a child together have extraincentive to file a joint return. Forexample, it’s the only way they can claim a credit or an exclusion on expensesincurred when adopting a child together. Depending on the couple’s income, theymay be able to claim a credit up to 35% of their qualifying expenditures.
Married same-sex couples now face the dilemma other spousesface: Do they file taxes jointly or separately? While a combined return offersa lower tax bill in most cases, it doesn’t hurt to run the numbers both waysbefore submitting your form to the IRS. Be sure to ask your tax preparer to show you the difference in filingjointly versus filing separately. Then,you can choose the best option for your family. We now have that choice and canchoose the path that benefits our families the most.
Here are some other useful sources or articles that mayhelp you:
- https://www.irs.gov/newsroom/answers-to-frequently-asked-questions-for-same-sex-married-couples
- https://www.cnbc.com/2021/11/16/same-sex-couples-may-get-tax-break-from-democrat-build-back-better-plan.html
- https://turbotax.intuit.com/tax-tips/marriage/state-tax-filing-for-same-sex-couples/L1aZjbQMj
- https://www.creditkarma.com/tax/i/lgbtq-tax-tips
- https://www.forbes.com/sites/davidrae/2021/03/30/4-valuable-tax-planning-strategies-gay-couples-need-today/?sh=387f82561da3
