When filing federal income taxes, everyone must select a filing status. The five filing statuses are single, married filing jointly, married filing separately, head of household, and qualifying widow/er with dependent child. Most people are only qualified for one or two of the statuses, and your status is bound to change at some point in your life. One common transition is filing from single to married.
In this post, we will look at how your tax situation may alter if your filing status changes from single to married.
Before talking about how your taxes will change, let’s consider the IRS definitions for when you can use the single vs. married filing statuses. To use the single filing status, you need to be unmarried, legally separated and/or divorced on the last day of the tax year (December 31). To qualify as married in the eyes of the IRS you need to get legally married on or before the last day of the tax year.
If you can legally file as married, then you must. Married individuals cannot file as single or as the head of a household. Keep in mind the requirements are the same for same-sex marriages. If you were legally married by a state or foreign government, the IRS will expect you to file as married.
After marriage, you have two choices for filing your taxes. Married filing separately will allow you and your spouse to file separate returns. This works very similarly to filing single. Married filing jointly should be your status choice if you want to file both your and your spouse’s incomes on one return. Filing only one return could save you time and money. Choosing one status over the other will result in different limits for tax brackets, deductions and credits.
How the Filing Process Changes From Single to Married
The clearest example of how your taxes will change after marriage is in the income tax brackets. The tables below show the tax brackets for the 2023 tax year (what you file in 2024) and the 2024 tax year (what you file in 2025). You’ll notice that if you choose to file a joint return, the minimum and maximum incomes will change for each tax bracket.
In some cases, married couples will find themselves in a lower tax bracket now that they are combining incomes. At the same time, married individuals who file separately will pay income taxes according to the same brackets as single filers.
Federal Income Tax Brackets for 2023 (filed by April 15, 2024)
| Single | Married Filing Jointly | Married Filing Separately | Head of Household | |
| 10% | $0 – $11,000 | $0 – $19,900 | $0 – $22,000 | $0 -$15,700 |
| 12% | $11,000 – $44,725 | $19,901 – $81,050 | $22,001 – $89,450 | $15,701 -$59,850 |
| 22% | $44,726 – $95,375 | $81,051 – $172,750 | $89,451 – $190,750 | $59,851 -$95,350 |
| 24% | $95,376 – $182,100 | $172,751 – $329,850 | $190,751 – $364,200 | $95,351 – $182,100 |
| 32% | $182,101 – $231,250 | $329,851 – $418,850 | $364,201 – $462,500 | $182,101 – $231,250 |
| 35% | $231,251 – $578,125 | $418,851 – $628,300 | $462,501 – $693,750 | $231,251 – $578,100 |
| 37% | $578,125+ | $628,300+ | $693,750+ | $578,100+ |
Federal Income Tax Brackets for 2024 (filed by April 15, 2025)
| Rate | Single | Married Filing Jointly | Married Filing Separately | Head of Household |
| 10% | $0 – $11,600 | $0 – $23,200 | $0 – $11,600 | $0 – $16,550 |
| 12% | $11,600 – $47,150 | $23,200 – $94,300 | $11,600 – $47,150 | $16,550 – $63,100 |
| 22% | $47,150 – $100,525 | $94,300 – $201,050 | $47,150 – $100,525 | $63,100 – $100,500 |
| 24% | $100,525 – $191,950 | $201,050 – $383,900 | $100,525 – $191,950 | $100,500 – $191,950 |
| 32% | $191,950 – $243,725 | $383,900 – $487,450 | $191,950 – $243,725 | $191,950 – $243,700 |
| 35% | $243,725 – $609,350 | $487,450 – $731,200 | $231,251 – $365,600 | $243,700 – $609,350 |
| 37% | $609,350+ | $731,200+ | $365,600+ | $609,350+ |
Outside of income taxes, filing a joint return will change limits for other deductions. For example, the standard deduction for the 2023 tax year is $13,850 ($14,600 in 2024) for single filers. The deduction for taxpayers who are married and file jointly for the 2023 tax year is $27,700 ($29,200 in 2024).
In this case, the deduction is doubled for joint filers. That isn’t always the case though. As another example, single filers can deduct up to $3,000 of capital gains losses from income. A married couple filing jointly can only deduct $3,000 total (not $3,000 each).
One big change that comes with marriage is how you report withholdings. Normally, you fill out your W-4 to reflect how many total exemptions you can take. After marriage, you and your spouse need to distribute your exemptions across both your W-4 forms.
So if you and your spouse each qualify for two exemptions (four total), the number of exemptions on your W-4 forms should add up to four. You cannot each take four exemptions. If you claim more exemptions than you should, your employers will not withhold enough paycheck taxes and you will owe money when you file your tax return.
When Will I Get My Tax Refund?
Filing taxes isn’t anyone’s idea of a good time, but a tax refund is a light at the end of the tunnel. Considering the Internal Revenue Service (IRS) refunded $172 billion in income tax in 2023, plenty of filers get a sizable return.
Read Also: How do I Get Around Crypto Tax?
How long does it take to receive your tax refund? What’s the average tax refund amount? And do certain characteristics, such as income or marital status, influence tax refund amounts?
Nine out of 10 tax refunds are issued within 21 days, according to the IRS.
Twenty-four hours after filing your refund online, you can access the IRS Where’s My Refund tool to get daily updates on your tax refund status. Paper filers have to wait six months or more before the tool becomes available.
The tool shows progress in three phases:
- Return received
- Refund approved
- Refund sent
Once your refund is approved, you will be given a date to expect your refund on by the IRS. Those who file their tax return online and sign up for direct deposit get their tax refund fastest, per the IRS.
Most states estimate that state tax refunds are issued within 10 weeks of processing.
While it’s not possible to predict how the average refund will change in the 2023 filing year, we asked experts at major tax service providers about how to maximize tax refunds and what changes to watch out for.
Inflation could lead to larger tax returns for some filers due to expanded income tax brackets and larger tax credit amounts, tax experts told The Motley Fool Ascent.
“Refunds should remain stable for most taxpayers with a possible bump due to larger inflation adjustments than last year,” says Kathy Pickering, chief tax officer at H&R Block. “Many of the items that affect taxpayers’ returns such as tax brackets, credit amounts, and income limitations, fluctuate each year based on certain economic indicators. With the increase in inflation we’ve faced in the last year, many of these items will be larger than normal, resulting in a slight bump in refunds.”
“With inflation adjustments like the standard deduction and income brackets increasing the most they have in decades, about 7%, this could help filers tax outcomes in the upcoming season,” Lisa Greene-Lewis, CPA and tax expert at TurboTax told The Motley Fool Ascent.
These are some other tips for maximizing your tax return.
1. Take advantage of credits and deductions
Changes to tax credits aren’t the only thing filers should be mindful of this coming tax season — they should also be cognizant of their own life changes, including changes to income and family size.
Greene-Lewis flagged the following tax credits as one’s filers often times miss:
- The Earned Income Tax Credit: a tax credit certain filers may qualify for if they earned less than $59,187 in the 2023 tax filing year.
- The Saver’s Credit: a tax credit for low- and moderate-income filers that contribute to a retirement account.
- The Child and Dependent Care Credit: a tax credit for filers that support a child under the age of 13 or a dependent (including those outside their family) who cannot take care of themselves and lived with the filer for more than half of the year.
According to Greene-Lewis, 1 out of 5 filers miss the Earned Income Tax Credit, which maxes out at $7,430, and others may not realize they’re eligible for the dependent part of the Child and Dependent Care Credit or the Saver’s Credit.
2. Organize W-2s and other paperwork
To maximize tax refunds and avoid delays or letters from the IRS, filers should make sure they have all their paperwork in order, including their W-2s and 1099s.
“One of the most common mistakes is reporting the wrong taxable income,” Pickering says. To avoid this, compare the W-2 or 1099 you receive against your own records. If you think it is wrong, inform the sender and ask them to file a corrected W-2 or 1099 with the IRS.”
Mark Steber, chief tax information officer at Jackson Hewitt, adds, “Personal situations can change annually, but if someone isn’t organized these changes can go overlooked. I always recommend people organize, and stay organized throughout the year. Organize tax-related documents into four categories: income items, deductions, life changes, and others.”
3. Double-check information entered into tax software
Many tax filing services transpose information from tax forms to calculate your return, but you should still double-check to make sure that the information received by the service matches what’s on your forms.
“One of the most common mistakes is not taking a moment to review the information you entered,” Mark Jaeger, vice president of tax development at TaxAct says.
Missing information or entering it incorrectly either through being rushed or disorganized can mean leaving benefits on the table. In that instance, the IRS won’t catch your mistake. “It is simply a mistaken concept that if you leave off a benefit the IRS will ‘find it and add it back and send you more money.’ Nothing could be farther from the truth,” says Steber.
Steber points out that there’s a growing trend of taxpayers making small but costly mistakes on their filings. “These mistakes have resulted in thousands of taxpayers seeing a delay in receiving their tax refund because their return is sent to the IRS’ error resolution system,” he says.
4. Make a plan to file a tax return
The biggest misstep? Not filing a tax return at all, says Lisa Greene-Lewis, CPA and tax expert at TurboTax.
Individuals who earn below the IRS income tax filing threshold ($13,850 for a single filer and $27,700 for a married couple filing jointly) are likely “leaving money on the table,” says Greene-Lewis, who pointed out that those earners may be eligible for the Earned Income Tax Credit.
“The IRS reports over $1 billion in unclaimed refunds that belong to filers who don’t file and the average unclaimed refund is over $800,” Greene-Lewis told The Motley Fool Ascent.
What to Expect From Your Tax Refund in 2024
Changes are coming for the 2023 tax filing year that could impact the size of tax refunds in 2024. These are the ones that are most likely to affect your potential tax refund.
New income tax brackets
The IRS widened income tax brackets for the 2023 filing year due to inflation.
2023 tax-filing year income tax brackets
| Tax Rate | Taxable income, single | Taxable income, married filing jointly | Taxable income, head of household |
|---|---|---|---|
| 10% | Up to $11,000 | Up to $22,000 | Up to $15,700 |
| 12% | $11,001 to $44,725 | $22,001 to $89,450 | $15,701 to $59,850 |
| 22% | $44,726 to $95,375 | $89,451 to $190,750 | $59,851 to $95,350 |
| 24% | $95,376 to $182,100 | $190,751 to $364,200 | $95,351 to $182,100 |
| 32% | $182,101 to $231,250 | $364,201 to $462,500 | $182,101 to $231,250 |
| 35% | $231,251 to $578,125 | $462,501 to $693,750 | $231,251 to $578,100 |
| 37% | Over $578,125 | Over $693,750 | Over $578,100 |
Data source: Internal Revenue Service (2023).
As a result, filers whose salaries haven’t kept pace with inflation may find themselves in a lower income tax bracket than last year.
Higher standard deduction
The IRS increased standard deduction amounts for the 2023 filing year as a result of inflation.
2023 tax filing year standard deductions
| Filing status | 2023 standard deduction |
|---|---|
| Single | $13,850 |
| Married, filing separately | $13,850 |
| Married, filing jointly; qualified widow/er | $27,700 |
| Head of household | $20,800 |
Data source: Internal Revenue Service (2023).
The standard deduction is the amount you can reduce your standard gross income by, which lowers your taxable income. Most filers take the standard deduction rather than an itemized deduction.
A higher standard deduction may help filers fall into a lower income tax bracket, particularly if inflation has outpaced their salary.
1099-K thresholds
The 1099-K form is used to report payments via payment cards and third-party networks, like Venmo, PayPal, and Cash App, for goods and services provided in either business or personal transactions. The threshold for filing a 1099-K in the 2023 tax filing year will remain at $20,000 and 200 transactions. The IRS had previously announced a lower threshold but reverted to the current one. For the 2024 tax year, the 1099-K threshold will be reduced to $5,000.
The 1099-K covers side hustles, like selling crafts on Etsy, earnings from sales on a website like eBay, and ticket resales through platforms like StubHub. Transactions with friends and family are not covered by the 1099-K.
Energy efficiency, clean energy, and electric vehicle tax credits
Tax credits from the Inflation Reduction Act for solar energy installations, home energy efficiency improvements, and electric vehicles (EVs) kick in for the 2023 filing year.
- The solar energy tax credit is now 30% for installations of solar panels and other solar-powered energy efficiency home improvements.
- The energy efficiency home improvement tax credit is now up to 30% of the cost of qualifying home energy efficiency improvements made in the 2023 tax year. The maximum claim is $1,200 for home improvements and $2,000 for qualifying heat pumps and biomass heating solutions. The lifetime dollar limit has been removed.
- Qualifying electric vehicles (EVs) purchased after Jan. 1, 2023, are eligible for a tax credit of up to $7,500.
What is The Average Tax Refund in the US?
The only thing enjoyable about tax season is imagining what you would do with any tax refund. The good news for some is that the average tax refund issued by the IRS thus far is $3,182, up from the previous year.
As of March 1, the Internal Revenue Service announced that the average refund has increased by 5.1% from $3,028 for the same timeframe through March 3, 2023. This year’s data contains an additional day in February due to the leap year.
The IRS received more than 54 million tax returns in the first five weeks of the current tax season, which began on January 29. This is down 1.7% from a year ago. Last year’s tax season started roughly a week early, on January 23.
The quantity of tax refunds received thus far has decreased from a year ago. The IRS issued 36.28 million tax refunds until March 1, a 13.7% decrease from a year ago. The total amount reimbursed through March 1 was roughly $115.5 billion, a 9.3% decrease from a year ago.
So far this tax season, there haven’t been many issues with IRS refunds. The IRS noted that filing season data thus far “continue to show a strong start to Filing Season 2024, with all systems running well.”
Who Gets the Biggest Tax Refund?
To maximize the amount on your tax return, you will most likely need to pay more in taxes during the year. It is important to highlight that specialists do not suggest this. If you receive a higher tax return, it signifies you are getting a refund. It may not be the greatest option for you because it implies the government is spending your money instead of you.
Instead, you can have the right amount of tax deducted each month and then invest it for yourself throughout the year. However, if you prefer to receive a larger refund on your return rather than more money during the year, you have numerous options. These are the four most common.
1. Know Your Filing Status
Your filing status can have a significant impact on your tax refund, regardless of whether you’re single or married. For most married couples, it makes sense to file jointly. However, there are some situations where you should consider filing separately.
For example, if you or your spouse has a significant amount of medical or business expenses, filing separately may reduce your adjusted gross income and increase the amount you can deduct (because these deductions can only be taken if they exceed a given percentage of your income).
On the other hand, filing separately means you may miss out on some key tax credits. Run the numbers to see which filing status yields the bigger benefit. And if math isn’t your forte, you can estimate your return easily with a free tax return calculator.
If you’re single, you could look into whether you qualify for head of household status. Generally, you need to have paid more than half the cost of maintaining a household for yourself and a qualifying dependent over the year.
For tax purposes, this could mean a child or a dependent adult, including an aging parent. If you’re able to file as a head of household it could give your refund a significant boost. For example, heads of household get a larger standard deduction than single filers.
2. Claim the Right Credits
A tax credit reduces the amount of tax you owe to the IRS on a dollar-for-dollar basis. For example, if you owe $6,000 in taxes and claim a credit worth $1,000, your bill drops to $5,000. Certain credits may even be refundable, which means you can claim them even if you don’t have any tax liability.
Some of the most common tax credits include:
- The Earned Income Tax Credit allows qualified tax filers to claim up to $6,728 for three or more qualifying children in tax year 2021 and $6,935 in tax year 2022. In 2023, this will go up to $7,430.
- The Child and Dependent Care Credit can provide up to $3,000 for one qualifying individual or $6,000 for two or more qualifying individuals. This credit helps reimburse childcare expenses incurred during the tax year.
- The Child Tax Credit is worth up to $2,000 per dependent for tax year 2022, but your income level determines exactly how much you can get. In 2021, the credit was $3,600 per dependent.
Your eligibility to claim these and other tax credits typically depends on your income, filing status and whether or not you have eligible dependents. For credits related to education expenses, there are additional guidelines regarding when you can claim them and which expenses qualify.
You may also earn credits for making certain energy-efficient improvements to your home. There is also the Premium Tax Credit which can offset some of the cost of premiums for insurance you buy through the federal health care exchange.
3. Deductions Can Also Benefit You
In terms of your tax refund, credits typically yield a bigger tax return than deductions. But that doesn’t mean you should overlook key write-offs for which you qualify. Instead of reducing the amount of tax you owe, deductions reduce the amount of income that is subject to tax.
When you file your taxes, you have to decide whether to take the standard deduction or itemize. For many filers, the Trump tax plan’s doubling of the standard deduction has made this choice an easy one. However, itemizing becomes the smarter choice when you have a lot of deductible expenses.
This includes business expenses like mileage and lodging, home office expenses if you’re self-employed, donations to charitable organizations, mortgage interest, student loan interest and even gambling losses. The amount of each expense you can deduct does vary. It’s also important to make sure you have appropriate records to back up your claims, like receipts or bank statements.
4. Max Out Your IRA
Setting aside money in a traditional IRA is a great way to build your nest egg and score an additional tax bonus. You can fund your IRA for the previous tax year right up to the April filing deadline and your contributions may be partially or fully deductible. It’s an above-the-line deduction, which means you can take the deduction even if you’re not itemizing.
You may also be able to claim a tax credit for your contributions. The Retirement Saver’s Credit applies to contributions to both traditional and Roth IRAs, but you have to meet specific income guidelines to qualify. When it comes to filing your taxes, every penny counts, especially when you’re trying to beef up your tax refund. The more you know about which tax benefits you qualify for, the more money you’ll be able to put in your pocket.
What Are The Tax Benefits of Marriage?
While marriage is not recommended for financial reasons, it does provide couples with the following tax benefits when filing jointly. Remember that the benefits listed below do not apply to couples filing separately, as we explain in greater detail below.
1. Potentially Lower Tax Bracket
Your income puts you into a specific tax bracket, meaning the government taxes your income at higher rates when you make more. However, if you’re married and filing jointly, the tax brackets may work in your favor.
For example, if you make $120,000 this year and file single, part of your income would land in the 24% tax bracket for 2022. On the other hand, say you are married and filing jointly. You make $120,000 and your spouse makes $40,000 this year. Your top tax bracket would be 22% because of how tax law places couples filing jointly.
2. Can Boost Retirement Savings
Federal law typically prevents single taxpayers who don’t earn wages from contributing to an individual retirement account (IRA). Fortunately, if a taxpayer who doesn’t earn wages is married, they can use their spouse’s income to fund their own IRA.
For example, if both spouses contribute to their own traditional IRAs, they would lower their taxable income by thousands of dollars. A spouse who has a retirement plan at work might lower the deductible amount from taxes – but the fact remains that the couple can each have IRAs.
Furthermore, couples filing jointly have a higher income limit for Roth IRA eligibility. Specifically, couples with a modified adjusted gross income (MAGI) of $204,000 or less in 2022 can make a full contribution to their accounts. In 2023, the MAGI limit will increase to $218,000.
3. Tax Shelter Opportunity
A spouse with a business that isn’t producing income wouldn’t be able to claim most deductions if they filed taxes separately. However, they can create a tax advantage for the couple. For instance, the other member of the marriage generating income can use their spouse’s losses as a tax deduction while also claiming deductions for mortgage interest payments, medical expenses and state and local taxes (SALT).
4. Estate Preservation
If one member of the couple passes away, they can transfer their entire estate – all their wealth and assets – to their spouse without incurring a nickel of estate taxes. As a result, married couples can preserve their wealth if one of them dies.
5. Increased Standard Deductions and Credits
When a taxpayer files single or married filing separately, the standard deduction is $12,950 for 2022. Married couples filing jointly don’t lose by taking the standard deduction. Instead, they receive double the amount for single filers, or $25,900, for 2022. Plus, filing jointly can lower your combined income enough to access tax credits such as the Child and Dependent Care Tax Credit and the American Opportunity Tax Credit.
In addition, taxpayers usually can only deduct charitable contributions of up to 50% of their annual income. However, those who file jointly combine their income to determine this limit. Plus, filing with a spouse allows you to carry over leftover contributions to the next year if one spouse’s income isn’t double the amount of their charitable giving for the year.
6. Less Expensive Tax Filings
Filing taxes can cost hundreds of dollars, so paying for one tax return instead of two significantly decreases expenses. In addition, filing jointly will likely require less time than filing twice.
Average Tax Refund for $100k Salary
Remember that a tax deduction reduces your taxable income, which indirectly lowers your tax bill by reducing the amount of income subject to a marginal tax rate. A tax credit is a dollar-for-dollar discount on your tax liability. So, if you owe $1,000 but qualify for a $500 tax credit, your tax obligation is reduced to $500.
What if you’re eligible for more tax credits than you owe, such as $1,000 in tax credits and $500 in liabilities? The $500 difference will be reimbursed to you depending on whether the tax credits for which you qualify are refundable or not. If your refundable tax credits exceed your owed amount, they will be applied to your tax refund.
Every year when you file your income taxes, three things can occur. You can discover that you owe the IRS money, that the IRS owes you money, or that you’re about even after paying the correct amount in taxes throughout the year. If the IRS owes you money, you will get it in the form of a tax refund. If you owe the IRS money, you will be required to pay a bill. The tax return calculator can help you determine how much money you may get or how much you are likely to owe.
How Does Marriage Affect Taxes?
For many people, marriage provides numerous rewards, including financial ones. However, if your significant other believes that marriage is more of a financial responsibility than a benefit, don’t be startled; this viewpoint is more frequent than you might imagine.
Married couples are widely believed to pay more in taxes than unmarried people. Not only is this mostly false for many couples, but there are other reasons why marriage is financially beneficial.
Two pieces of tax legislation included significant modifications that benefit married couples, particularly those with children.
The Tax Cuts and Jobs Act (TCJA), signed by President Donald Trump on December 22, 2017, resulted in many modifications to the tax law aimed at lowering corporate, individual, and inheritance taxes.
These tax code amendments resulted in only minor decreases in income tax rates for most individual tax bands while providing large tax breaks to corporations. Furthermore, individual tax savings are set to expire in 2025, but corporate and other entities will continue to benefit.
The American Rescue Plan, signed by President Biden on March 11, 2021, included substantial tax breaks for low- and moderate-income people. For example, in 2021 only, the earned-income tax credit increased to $1,502 for childless households. For example, for the 2022 tax year, the Earned Income Tax Credit is as much as $6,935 for qualifying taxpayers who have three or more children.
For the 2023 tax year, the credit maximum increases to $7,430, and to $7,830 in 2024. People without children could claim the earned-income tax credit beginning at age 19 (instead of the previous age of 25), and the upper age limit, 65, was eliminated.
What Are Marriage Penalties and Bonuses?
For couples, America’s progressive tax structure can be both beneficial and detrimental. Despite several reform efforts, a marriage penalty remains for some couples who earn roughly the same and are pushed into a higher tax rate when their family income more or less doubles after marriage. This applies to both wealthy and low-income couples.
Couples in which one partner makes all of the income—or much more than the other—may benefit from a marriage bonus since the higher earner’s bracket reduces after marriage, resulting in lower taxes than if they’d filed separately as singles.
According to the Tax Foundation, marriage incentives can total 21% of a couple’s income, while marriage penalties can reach 12%.
Eliminating marital penalties and bonuses would necessitate a massive overhaul of the tax code, which would have far-reaching consequences. Instead, policymakers rely on loopholes to the marriage penalty.
Marriage Tax Allowance
If you’re married or in a civil partnership, one of you may transfer up to £1,260 of your Personal Allowance to the other. This is somewhat more than 10% of the basic £12,570 Personal Allowance for the 2024/25 tax year. (The Basic Personal Allowance is the amount of income that is not subject to tax).
This transfer decreases a partner’s tax liability by up to £252 for the tax year (6 April to 5 April the following year). Marriage Allowance is often referred to as the Marriage Tax Allowance.
You might qualify for Marriage Allowance if:
- you’re married, or in a civil partnership and don’t receive Married Couple’s Allowance
- you do not pay income tax or you earn less than your Personal Allowance so are not liable to tax. This will usually mean an income of less than £12,570 for 2024/25.
- your partner pays tax on their income at the basic rate so is not liable to tax at the higher or additional rates. This will usually mean your partner has an income between £12,571 and £50,270 before they receive the Marriage Allowance. If you’re in Scotland, your partner must pay the starter, basic or intermediate rate, which usually means their income is between £12,571 and £43,662.
Marriage Allowance means the partner who earns more will get £1,260 added to their basic Personal Allowance.
Of the amount of money transferred to a partner as part of Marriage Allowance – 20% is given as a reduction in their tax bill. This is different from Personal Allowance – which is deducted from taxable income before tax is worked out.
The tax code of the partner receiving the Marriage Allowance will usually change to ‘M’. This shows they’re getting Marriage Allowance from their partner.
If the partner who transferred their Personal Allowance is employed, their tax code will change to ‘N’. This shows they’ve elected to use the Marriage Allowance.
You can apply online to HMRC at GOV.UK. All you need is your National Insurance number and identification.
You can also apply by calling 0300 200 3300*
*Lines are open Monday to Friday: 8am to 6pm, there may be call charges.
Final Words
“Couples with significant earning differences between the spouses typically reap the greatest savings,” said President of Coastal Wealth’s Private Client Group in Ft. Lauderdale, Florida, Chad Tourin, a financial professional, attorney, and accountant.
That’s because both spouses’ incomes are combined in determining their tax bracket. “Thus, if one spouse earns considerably less than the other, they may be pulled down into a lower tax bracket and in turn reduce their overall tax liability,” said Tourin.
To illustrate: A single individual earning $200,000 a year would be subject to the 32 percent marginal tax rate in 2023 and 2024, but drop to the 24 percent tax rate as a married taxpayer filing jointly if their spouse did not produce an income, or if their combined household income remained below the 24 percent tax bracket cut-off: $364,201850 threshold for tax year 2023 or $383,900 for tax year 2024.1,2
Beyond the lower tax bracket, which alone can yield significant savings, married couples may also benefit from the following tax savings opportunities:
- Combined federal gift and estate tax limit
- Estate tax advantage
- Higher standard deduction
- Spousal IRA contributions
- FSA contributions
- Personal residence exemption
- Earned Income Tax Credit
