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Newby, Ravi, and Valerie.
What do the 3 of you think about my statements that individuals, whether married or single, should be responsible for the same level of taxes if they are at the same income level?
If you're a married woman making 50,000/year do you feel you should be responsible for the same amount of taxes as a single woman making 50,000/year? Why do you feel the way you do?
(Sorry but you guys seem really into the thread and I wanted to try to bring it back on topic)
Sorry, Pilgrim...I didn't see your post 'til after I logged off.
Federal tax laws are very different than marriage statutes, first of all...
Tax laws are very complex and married couples have the option to file separately.
In another article, we discussed the "marriage penalty" and how it might impact you as a taxpayer. The obvious next question is: "Should my spouse and I file using the married-separate filing status to avoid the marriage penalty?"
As is often the case with tax questions, there is no clear-cut answer. It depends on your individual tax situation.
In general, your decision will depend on which filing status results in the lowest tax. But, while that might seem obvious, there is one very important consideration you should take into account: If you and your spouse file a joint return, you are jointly and severally liable for the full amount of tax and any interest or penalty due.
This means that, if your spouse decides to take the cash out of the bank and run away to Costa Rica, you could be stuck with the total tax liability. Therefore, regardless of which method results in less tax, you might choose to file a separate return if you want to ensure you're only responsible for paying your own tax.
Note: There are "innocent spouse" rules in place that might help you in a situation like this, but you don't want to rely on them exclusively. Your best bet would still be filing a separate return. For more information on the "innocent spouse" rules, see IRS Publication 971.
In most cases, filing jointly offers the most tax savings, particularly where the spouses have different income levels. The "averaging" effect of combining the two incomes can bring some of it out of a higher tax bracket. For example, if one spouse has $75,000 of taxable income and the other has just $15,000, filing jointly can save about $1,500 in taxes versus filing separately.
But, remember that filing separately doesn't mean you go back to using the "single" rates that applied before you were married. Instead, each spouse must use the "married, filing separately" rates. These rates are based on brackets that are exactly half of the "married, filing jointly" brackets, but are still less-favorable than the "single" rates. This means that the "marriage penalty" can't necessarily be eliminated simply by filing separate returns.
The Upside and The Downside
Fool.com: Married, Filing Separate
Yes Valerie I understand this. As it states in your quote "In most cases, filing jointly offers the most tax savings, particularly where the spouses have different income levels. The "averaging" effect of combining the two incomes can bring some of it out of a higher tax bracket. For example, if one spouse has $75,000 of taxable income and the other has just $15,000, filing jointly can save about $1,500 in taxes versus filing separately."
That is the benefit I'm talking about. yes married people can file separately however single people have no way to enjoy the benefit of filing jointly. It creates an inequitable situation in our taxes.
Do you feel this is acceptable? Why or why not?
Married taxpayers can choose between filing a joint tax return or a separate tax return. The Married Filing Separately filing status provides fewer tax benefits than filing joint returns, but taxpayers will need to weigh the pros and cons and decide for themselves which is the best filing status.
If you are married, then you and your spouse can file separate tax returns. The married filing separately (MFS) filing status is the least beneficial of all the filing statuses. That's because MFS taxpayers are not eligible to claim the following tax benefits:
* Tuition and fees deduction
* Student loan interest deduction
* Tax-free exclusion of US bond interest
* Tax-free exclusion of Social Security Benefits
* Credit for the Elderly and Disabled
* Child and Dependent Care Credit
* Earned Income Credit
* Hope or Lifetime Learning Educational Credits
MFS taxpayers also have lower income phase-out ranges for the IRA deduction.
Additionally, MFS taxpayers must both claim the standard deduction or must both itemize their deductions. In other words, one MFS taxpayer cannot claim the standard deduction if the other spouse is itemizing.
Married Filing Separately Filing Status - Claiming the Married Filing Separately Status on Your Tax Return
It is very complex and just goes to show we need to simplify things.
Not so sure if filing separately is better than filing single...?
Married taxpayers can choose between filing a joint tax return or a separate tax return. The Married Filing Separately filing status provides fewer tax benefits than filing joint returns, but taxpayers will need to weigh the pros and cons and decide for themselves which is the best filing status.
If you are married, then you and your spouse can file separate tax returns. The married filing separately (MFS) filing status is the least beneficial of all the filing statuses. That's because MFS taxpayers are not eligible to claim the following tax benefits:
* Tuition and fees deduction
* Student loan interest deduction
* Tax-free exclusion of US bond interest
* Tax-free exclusion of Social Security Benefits
* Credit for the Elderly and Disabled
* Child and Dependent Care Credit
* Earned Income Credit
* Hope or Lifetime Learning Educational Credits
MFS taxpayers also have lower income phase-out ranges for the IRA deduction.
Additionally, MFS taxpayers must both claim the standard deduction or must both itemize their deductions. In other words, one MFS taxpayer cannot claim the standard deduction if the other spouse is itemizing.
Married Filing Separately Filing Status - Claiming the Married Filing Separately Status on Your Tax Return
History of the Income Tax in the United States
History of the Income Tax in the United States — Infoplease.com
Maybe it has to do with the deductions. If married, one of the couple can file head of household and have less taken out in taxes. But in the end, I don't see a real benefit. How many married couples can claim earned income credits?It is very complex and just goes to show we need to simplify things.
Not so sure if filing separately is better than filing single...?
Married taxpayers can choose between filing a joint tax return or a separate tax return. The Married Filing Separately filing status provides fewer tax benefits than filing joint returns, but taxpayers will need to weigh the pros and cons and decide for themselves which is the best filing status.
If you are married, then you and your spouse can file separate tax returns. The married filing separately (MFS) filing status is the least beneficial of all the filing statuses. That's because MFS taxpayers are not eligible to claim the following tax benefits:
* Tuition and fees deduction
* Student loan interest deduction
* Tax-free exclusion of US bond interest
* Tax-free exclusion of Social Security Benefits
* Credit for the Elderly and Disabled
* Child and Dependent Care Credit
* Earned Income Credit
* Hope or Lifetime Learning Educational Credits
MFS taxpayers also have lower income phase-out ranges for the IRA deduction.
Additionally, MFS taxpayers must both claim the standard deduction or must both itemize their deductions. In other words, one MFS taxpayer cannot claim the standard deduction if the other spouse is itemizing.
Married Filing Separately Filing Status - Claiming the Married Filing Separately Status on Your Tax Return
History of the Income Tax in the United States
History of the Income Tax in the United States — Infoplease.com
Since single people can claim some of those things then I think the presumption of the OP, as if single filing was getting the short end of the stick, is false.
PP feeding us false information? Say it isn't so!think the presumption of the OP, as if single filing was getting the short end of the stick, is false.
PP feeding us false information? Say it isn't so!think the presumption of the OP, as if single filing was getting the short end of the stick, is false.
Ravi said:Maybe it has to do with the deductions.
Since single people can claim some of those things then I think the presumption of the OP, as if single filing was getting the short end of the stick, is false.
PP feeding us false information? Say it isn't so!think the presumption of the OP, as if single filing was getting the short end of the stick, is false.
Then quit being disingenuous. And do a little research. Sometimes it is beneficial tax wise to be married and sometimes it is not.PP feeding us false information? Say it isn't so!think the presumption of the OP, as if single filing was getting the short end of the stick, is false.
Unlike you at least valerie uses her brain when aked a question. She actually took time to check some stuff out, you on the other hand just defelect, insult, and completely avoid providing your opinion.
Is it because this isn't any kind of political issue right now and there are no talking points readily available for you? Probably.
Then quit being disingenuous. And do a little research. Sometimes it is beneficial tax wise to be married and sometimes it is not.PP feeding us false information? Say it isn't so!
Unlike you at least valerie uses her brain when aked a question. She actually took time to check some stuff out, you on the other hand just defelect, insult, and completely avoid providing your opinion.
Is it because this isn't any kind of political issue right now and there are no talking points readily available for you? Probably.
Let me preface this by stating my opinion on marriage. I feel gays, if they want to, should be allowed to get married. I also feel that non-gay people, if they want to, should be allowed to get married.
My issue comes with the "Equal Rights" part of the whole marriage and taxes equation.
Why should Gay married couples or Straight Married couples receive preferencial treatment from our government through the tax system?
Is this not discriminatory against non-married americans?
Why should non-married americans have to have a larger tax burden than married americans under our tax laws?
There are some questions to get a discussion going.
My personal opinion is that single people do not have the same and equal rights as married people under the tax code therefore everyone should be taxed at an individual tax rate regardless of marriage status.
Debate, Discuss, and disagree if you don't like the opinion. Try to tell me why you think i'm right or wrong in my opinion.
because since time immortal, marriage has been the bedrock of society. Married couples are more likely to be stable & thus contribute to society moreso as a whole. Plus, if you start taxing married couples as individuals, you will screw them over.....
Bullshit.
https://secure.wikimedia.org/wikipedia/en/wiki/Marriage_penalty
The marriage penalty in the United States refers to the higher taxes required from some married couples, where spouses are making approximately the same taxable income, filing one tax return ("married filing jointly") than for the same two people filing two separate tax returns if they were unmarried (i.e. filing as "single", not "married filing separately"). The percentage of couples affected has varied over the years, depending on shifts in tax rates.
Since single people can claim some of those things then I think the presumption of the OP, as if single filing was getting the short end of the stick, is false.
There are some instances where this is the case such as when the combined incomes pop them into a higher tax bracket.
However, if you just take the same exact income level, say $100,000 then every time the couple filing it jointly will pay a lower tax rate than an individual filing for that same exact income level. This will be true every time. Just look to the tax tables and you will see it very clearly.
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf
Since single people can claim some of those things then I think the presumption of the OP, as if single filing was getting the short end of the stick, is false.
There are some instances where this is the case such as when the combined incomes pop them into a higher tax bracket.
However, if you just take the same exact income level, say $100,000 then every time the couple filing it jointly will pay a lower tax rate than an individual filing for that same exact income level. This will be true every time. Just look to the tax tables and you will see it very clearly.
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf
Okay, let's put it is a more clear perspective. There really is little or no advantage with the current tax policy.
From the tax tables:
A single person earning $20,000 AGI pays $2,586.
A married couple each earning $20,000 AGI and filing separately pays $2,586 or $5,172 total.
Filing jointly that same couple with a combined income of $40,000 AGI pays $5,169 so you can see there really isn't any inequity except that married couples filing jointly get advantage of a higher standard deduction under the Bush tax policy. They will lose that advantage in 2011 if Congress does not act to keep it and will be paying more.
Also if the head of household is the only one bringing in income of $40,000 AGI and the wife is home awaiting the birth of their first child, and they file as singles - she pays zero because she has no income. He pays $6,194. (she actually gets a check even though she didn't earn under bush's tax policies)
In my opinion as I said, there are far more advantages to encourage people to get married even if they get a tax break to encourage that. The reduction in child poverty, the better schools, the more stable, prosperous neighborhoods that result more than make up for any 'lost' revenues to the national treasury.
There are some instances where this is the case such as when the combined incomes pop them into a higher tax bracket.
However, if you just take the same exact income level, say $100,000 then every time the couple filing it jointly will pay a lower tax rate than an individual filing for that same exact income level. This will be true every time. Just look to the tax tables and you will see it very clearly.
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf
Okay, let's put it is a more clear perspective. There really is little or no advantage with the current tax policy.
From the tax tables:
A single person earning $20,000 AGI pays $2,586.
A married couple each earning $20,000 AGI and filing separately pays $2,586 or $5,172 total.
Filing jointly that same couple with a combined income of $40,000 AGI pays $5,169 so you can see there really isn't any inequity except that married couples filing jointly get advantage of a higher standard deduction under the Bush tax policy. They will lose that advantage in 2011 if Congress does not act to keep it and will be paying more.
Also if the head of household is the only one bringing in income of $40,000 AGI and the wife is home awaiting the birth of their first child, and they file as singles - she pays zero because she has no income. He pays $6,194. (she actually gets a check even though she didn't earn under bush's tax policies)
In my opinion as I said, there are far more advantages to encourage people to get married even if they get a tax break to encourage that. The reduction in child poverty, the better schools, the more stable, prosperous neighborhoods that result more than make up for any 'lost' revenues to the national treasury.
If i "cherry pick" an example I can show a greater bias than your example.
Look at $40,000/year + individuals and the inequities become very clear.
Here lets try 70,000/year:
A single person making $70,000/year is responsible for $13,694/year in federal income tax
A married couple making $70,000/year are responsible for $9,881/year.
Thats a difference of almost $4,000.
To valerie, the above example is inequity under the law hence my title saying "equal rights for ALL people" Why should I have to pay $4,000 more a year than my co-worker only because he has a wedding ring on his finger and I dont? To me that is not equal rights or equal treatment under the law.
"
Where are you getting your figures?
There are some instances where this is the case such as when the combined incomes pop them into a higher tax bracket.
However, if you just take the same exact income level, say $100,000 then every time the couple filing it jointly will pay a lower tax rate than an individual filing for that same exact income level. This will be true every time. Just look to the tax tables and you will see it very clearly.
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf
Okay, let's put it is a more clear perspective. There really is little or no advantage with the current tax policy.
From the tax tables:
A single person earning $20,000 AGI pays $2,586.
A married couple each earning $20,000 AGI and filing separately pays $2,586 or $5,172 total.
Filing jointly that same couple with a combined income of $40,000 AGI pays $5,169 so you can see there really isn't any inequity except that married couples filing jointly get advantage of a higher standard deduction under the Bush tax policy. They will lose that advantage in 2011 if Congress does not act to keep it and will be paying more.
Also if the head of household is the only one bringing in income of $40,000 AGI and the wife is home awaiting the birth of their first child, and they file as singles - she pays zero because she has no income. He pays $6,194. (she actually gets a check even though she didn't earn under bush's tax policies)
In my opinion as I said, there are far more advantages to encourage people to get married even if they get a tax break to encourage that. The reduction in child poverty, the better schools, the more stable, prosperous neighborhoods that result more than make up for any 'lost' revenues to the national treasury.
If i "cherry pick" an example I can show a greater bias than your example.
Look at $40,000/year + individuals and the inequities become very clear.
Here lets try 70,000/year:
A single person making $70,000/year is responsible for $13,694/year in federal income tax
A married couple making $70,000/year are responsible for $9,881/year.
Thats a difference of almost $4,000.
To valerie, the above example is inequity under the law hence my title saying "equal rights for ALL people" Why should I have to pay $4,000 more a year than my co-worker only because he has a wedding ring on his finger and I dont? To me that is not equal rights or equal treatment under the law.
"
mmmkay...but you forget to take into account that the married couple is actually two people. If they both made $35,000 they'd pay the same amount of taxes if they filed as singles or as a married couple at $70,000 total.
Okay, let's put it is a more clear perspective. There really is little or no advantage with the current tax policy.
From the tax tables:
A single person earning $20,000 AGI pays $2,586.
A married couple each earning $20,000 AGI and filing separately pays $2,586 or $5,172 total.
Filing jointly that same couple with a combined income of $40,000 AGI pays $5,169 so you can see there really isn't any inequity except that married couples filing jointly get advantage of a higher standard deduction under the Bush tax policy. They will lose that advantage in 2011 if Congress does not act to keep it and will be paying more.
Also if the head of household is the only one bringing in income of $40,000 AGI and the wife is home awaiting the birth of their first child, and they file as singles - she pays zero because she has no income. He pays $6,194. (she actually gets a check even though she didn't earn under bush's tax policies)
In my opinion as I said, there are far more advantages to encourage people to get married even if they get a tax break to encourage that. The reduction in child poverty, the better schools, the more stable, prosperous neighborhoods that result more than make up for any 'lost' revenues to the national treasury.
If i "cherry pick" an example I can show a greater bias than your example.
Look at $40,000/year + individuals and the inequities become very clear.
Here lets try 70,000/year:
A single person making $70,000/year is responsible for $13,694/year in federal income tax
A married couple making $70,000/year are responsible for $9,881/year.
Thats a difference of almost $4,000.
To valerie, the above example is inequity under the law hence my title saying "equal rights for ALL people" Why should I have to pay $4,000 more a year than my co-worker only because he has a wedding ring on his finger and I dont? To me that is not equal rights or equal treatment under the law.
"
The thing with using that term "equality under the law" and "equal rights" as it relates to marriage, is that marriage laws are state laws...Statutes which are bound by the 14th amendment which says: "No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws. "
Federal tax tables are a whole different can of worms, is all I'm saying...
Yes, federal tax laws are complex and although you may find some individuals who are better off filing as a couple and vice versa, that is an issue of federal tax equity which has certain other provisions under the constitution. (the 16th amendment?)
