There are many events in life that have a noteworthy tax impact. In this series, we will discuss how simple life changes such as marriage, the birth of a child, divorce or separation, job loss and starting a new career can significantly impact your tax liability or refund. This week we will discuss the tax consequences of a life change like getting married.
One of the biggest headaches about getting married and filing your taxes is simply changing your name. If you changed your name as a result of a recent marriage, you will need to take the necessary steps to ensure that the name on your Social Security Card matches the name on the tax return. A mismatch between the name on your tax return and the name registered with the Social Security Administration can cause problems in the processing of your tax return and can even affect when you receive your refund.
If you took your spouse’s last name or both spouses hyphenated their last names, you will need to notify the Social Security Administration. If you do not, when you file your tax return using your new last name, the IRS computers will not be able to match the new name with your social security number. However, the steps to inform the Social Security Administration of a name change are easy. You will need to file a Form SS-5, Application for a Social Security Card at your local SSA office. When you go to fill out this form, it is important to bring a recently issued document, an original marriage certificate, as proof of your legal name change. The new card that the Social Security Administration will administer to you will show your new legal name, but contain your same social security number.
If your spouse has a previous tax balance with the IRS, you can prevent your portion of a jointly filed tax refund from being used to offset their remaining tax balance by filing your 1040 along with a Form 8379, Injured Spouse Allocation. The Injured Spouse Allocation form should only be filed if all or part of your portion of the tax refund is expected to be applied to your spouse’s past-due federal tax, state tax, child or spousal support, or a federal nontax debt, such as a student loan.
Tune in next week as we discuss the tax consequences of having a child!