The marriage penalty

[KCcarguy]

Let me start this tread by saying I am very happily married to an incredible woman. However, I work in healthcare and it has enlightened me on some of the little games our fellow Americans play. Truth is, if you're married, the joke is on you. Some of you might want to think twice before doing the "right thing" and getting married like my wife and I did. Here's how the smart people are doing it:

-have kids, live together, even buy a house together.....that's OK, you don't have to be married to do any of these things

-this allows you the benefit of filing taxes separately and paying less!!! May be even collecting some sort of assistance if your separate incomes are low enough!!! Better yet, a mother can receive Medicaid for herself and children, and the father only has to buy individual insurance at a fraction of the cost!!!!

-That's immoral, you say? No problem.....do what many have done: Have a wedding or "spiritual commitment" ceremony to show your lifetime commitment and pledge your love. But DON'T file for a marriage license!! That way you can have all the fun without the tax burden!

-So, with the current tax code if you're married, you loose......sorry. Don't be stupid and pay the "marriage penalty" like I did.

*rant finished*

 

[TOY2G]

Let me start this tread by saying I am very happily married to an incredible woman. However, I work in healthcare and it has enlightened me on some of the little games our fellow Americans play. Truth is, if you're married, the joke is on you. Some of you might want to think twice before doing the "right thing" and getting married like my wife and I did. Here's how the smart people are doing it:

-have kids, live together, even buy a house together.....that's OK, you don't have to be married to do any of these things

-this allows you the benefit of filing taxes separately and paying less!!! May be even collecting some sort of assistance if your separate incomes are low enough!!! Better yet, a mother can receive Medicaid for herself and children, and the father only has to buy individual insurance at a fraction of the cost!!!!

-That's immoral, you say? No problem.....do what many have done: Have a wedding or "spiritual commitment" ceremony to show your lifetime commitment and pledge your love. But DON'T file for a marriage license!! That way you can have all the fun without the tax burden!

-So, with the current tax code if you're married, you loose......sorry. Don't be stupid and pay the "marriage penalty" like I did.

*rant finished*

At first I was all........:mad2:
Then I was like.........:shrug:
But then I went all........:ybrick:
Now I feel.....:doh:

I have been married for 14 years, and I think you may be on to something...Get married for Spiritual reasons...sure, it biblical...But you are right....file papers so you can donate more to Obama Care = not biblical and a little :faint:

 

[BrianSD_42]

Well you lose a lot less if you work for a Fortune 500 or the government (military etc)

Being married allows you health care benefits not granted to a GF or BF.

My employer pays 80% of my healthcare premiums and would do the same for her if I was married.

Non employer based health care for a 30 year old can be $500 a month in some states.

 

[BrianSD_42]

The biggest joke is on those who live in alimony states.

Get a pre-nup.

In NJ if you are married even only 1 year you have to pay alimony for LIFE .... WTF! It's true. I read about from a legit source. What a damn scam.
Soldier from NJ gets cheated on while on deployment. Comes home and is told he's being divorced and will have to pay alimony for life. The payments don't even stop when he retires. He has to pay until he dies, she gets re-married, or she dies.

 

[jahdai42]

Sounds like the continuing agenda to destroy the family...

 

[KCcarguy]

Well you lose a lot less if you work for a Fortune 500 or the government (military etc)

Being married allows you health care benefits not granted to a GF or BF.

My employer pays 80% of my healthcare premiums and would do the same for her if I was married.

Non employer based health care for a 30 year old can be $500 a month in some states.

Highly variable, but true. You have exceptional benefits. Many companies are only covering individuals and dropping family coverage if a spouse can get coverage. If premiums are $500 for an individual, that person is making too much to qualify for subsidies. Just like my family premiums that have gone to $980/ month. That's a pretty sad product of the ACA, when I was 30, I had BCBS basic for about $100/ month.

But you're right, the benefits of cheating the system work more for those with lower incomes or with a one partner who has a significantly larger income.

 

[KCcarguy]

Sounds like the continuing agenda to destroy the family...

I don't think so. The marriage penalty has been around a very long time. People are just playing the game now.

 

[bofa]

While you're at it, lets talk about the DINK penalty. No deductions for not having a kid. Plus my employer saves about 10k annually on benefits, but I don't see that money.

 

[SV_Dude]

I must be missing something here. If you're married then you have a different tax bracket and actually pay a little less in taxes because you file jointly. If you're single you have a higher tax bracket than the half of a married tax bracket. Unless I'm missing something here I'm not seeing the point of this.

 

[KCcarguy]

I must be missing something here. If you're married then you have a different tax bracket and actually pay a little less in taxes because you file jointly. If you're single you have a higher tax bracket than the half of a married tax bracket. Unless I'm missing something here I'm not seeing the point of this.

You are not considering the combined income of a married couple vs two smaller individual incomes. For instance, if the woman makes 20k a year and husband makes 50, they will be taxed much less as single individuals than they would as a married couple making 70k. The woman also qualifies for Medicaid and other benefits she wouldn't receive if she was married.

Like everything in our system, it's complicated and variable. I'm just telling you literally every day I see married couples filing under the wife's (who doesn't work or has a lower income) maiden name and/ or non married couples with high household incomes filing with Medicaid because of this. Basically baby daddy makes $80k a year and mommy stays home with the kids. They aren't married so YOU get to pay her medical bills via Medicaid because she files as a low income single mother.

In my opinion, marriage status should not affect your taxes at all.

 

[KCcarguy]

http://http://en.m.wikipedia.org/wiki/Marriage_penalty

 

[Millerad1651]

Yep, it sucks tax wise for me. With both our incomes it takes us to the next bracket, increasing our taxable amount. And once my wife starts a nursing job, its gonna get ridiculous!
As for insurance though, I lucked out. I work for a private university that has pretty good insurance, and doesn't make the spouse use theirs if available.

 

[jahdai42]

While you're at it, lets talk about the DINK penalty. No deductions for not having a kid. Plus my employer saves about 10k annually on benefits, but I don't see that money.

I'm in that same boat, if we have a kid and the wife quits her job we will actually take home more money. :/

 

[eddiebx]

You are not considering the combined income of a married couple vs two smaller individual incomes. For instance, if the woman makes 20k a year and husband makes 50, they will be taxed much less as single individuals than they would as a married couple making 70k. The woman also qualifies for Medicaid and other benefits she wouldn't receive if she was married.

Like everything in our system, it's complicated and variable. I'm just telling you literally every day I see married couples filing under the wife's (who doesn't work or has a lower income) maiden name and/ or non married couples with high household incomes filing with Medicaid because of this. Basically baby daddy makes $80k a year and mommy stays home with the kids. They aren't married so YOU get to pay her medical bills via Medicaid because she files as a low income single mother.

In my opinion, marriage status should not affect your taxes at all.

I'm far from a tax expert, but couldn't you just file your returns as "married-filing separately" status? Then I think the federal returns are pretty much as if you were not married?

 

[eddiebx]

I must be missing something here. If you're married then you have a different tax bracket and actually pay a little less in taxes because you file jointly. If you're single you have a higher tax bracket than the half of a married tax bracket. Unless I'm missing something here I'm not seeing the point of this.

Not sure how to explain this one but I think I do see his point he is trying to make, hopefully this makes sense and I am not too far off.

These are all just theoretical numbers, I've no clue what the actual rates are but, for example for the first $15k of income, you are taxed @10%; the next $15k of income you are taxed @20%.

If you each file individually, you each get your $15k taxed @10%. If you file jointly, your income appears as one lump sum of $30k; thus you are actually being taxed at the effective rate of 15% (first $15k @ 10%, and next $15k @ 20%).

It gets more complex than that because there are tax breaks and stuff for lower income so under a certain amount you might not get taxed at all as individuals, but if married you might break the threshold and end up having to pay taxes since you don't qualify for the tax breaks.

Hope that makes sense!

 

[JB.]

Marriage penalty

I wonder if Obamacare has the potential to affect this since the income reporting is simply per household, regardless, as far as I know, of any marital status.

 

[BrianSD_42]

Trust me the biggest marriage tax is the one when you get divorced.

The biggest joke is on those who live in alimony states.

Get a pre-nup.

In NJ if you are married even only 1 year you have to pay alimony for LIFE .... WTF! It's true. I read about from a legit source. What a damn scam.
Soldier from NJ gets cheated on while on deployment. Comes home and is told he's being divorced and will have to pay alimony for life. The payments don't even stop when he retires. He has to pay until he dies, she gets re-married, or she dies.

 

[KCcarguy]

I'm far from a tax expert, but couldn't you just file your returns as "married-filing separately" status? Then I think the federal returns are pretty much as if you were not married?

I'm no expert either. But I know for my wife and me that's not the case.

 

[RunninInGA]

Trust me the biggest marriage tax is the one when you get divorced.

LoL - no need to repeat yourself - we got it the first time. :hug:

 

[eddiebx]

I'm no expert either. But I know for my wife and me that's not the case.

Ah yeah, I guess there's probably way more underlying stuff...my expertise is based on playing with all the sliders and buttons in my Turbotax program when I'm bored, lol.