Marriage and Taxes Essay

Marriage and Taxes Introduction Bill and Mary jut to marry in December of 2012. Bills salary is $32,000 and he owns a residence. His itemized deductions total $12,000. Marys salary is $39,000. Her itemized deductions total unless $1,600 as she does not own a residence. Assume that 2013 assess says, exemptions, and streamer deductions argon the same as 2012. Task(s) Answer the following questions a.What will their tax be if they marry before course of study-end and file a occasion return? The file joint of returns will be $12,000. b. What will their combine taxes be for the year if they delay the marriage until 2013? The combined taxes will be $13,600 if they delay the marriage. $12,000 + 1,600 = 13,600. c. What factors contribute to the difference in taxes? Some of the factors that can moment a difference in the taxes would be based on your itemized deductions.Examples a itemized deductions are mortgages that you own, have done any charitable donations, medical expenses, lo ng-term care services, and relocating for new employment. For a marriage case they can us the marriage penalty, Examples of a marriage penalty (1) Both of the earns $80,000 a year mas two single individuals, the marginal tax rate will be 25% However, if you are a married couple, the marginal tax rate on a $160,000 annual income is 28%. 2) If you are married you are allowed to keep off a total of $3,000 in losses, if filing separately, each only has a $1,500 limit whereas two single individuals can write off a total of $6,000. (3) When it comes to IRA contributions, they are phased out at income levels between $178,000 $188,000 for married couples versus a range of $112,000 $127,000 for single taxpayers. Ingenuity. Empathetic.