There was a article this week on cnnfn.com that I thought was rather lopsided in its arguments.
http://money.cnn.com/2011/12/26/pf/taxes/gay_marriage_taxes/index.htm
Certainly same-sex couples could face more potential tax liability under certain circumstances - as the article points out.
On the other hand, there are many, many reasons they should be happy they can continue to file "single" instead of "married filing jointly." Some of the comments below the article attest to this lack of a balanced argument.
In fact, my tax advice, if you are married and looking for some tax breaks is to get a divorce! Kidding :)
I'll give you five short reasons why the tax code discourages getting married (there are many more, but for the sake of "blog brevity" - I will limit it to five):
1) Capital losses - For an individual, capital losses are limited to capital gains plus $3000. For two single people, that means a total loss of $6,000. Get married - it is back to $3,000. Advantage - FILING SINGLE.
2) Roth IRA contributions - If you want to make a contribution to a Roth IRA in 2011 - for single, your income must be less than $107,000. Does it go to $214,000 if you are married filing jointly? Nope - only to $167,000.
Advantage - FILING SINGLE
3) Rental losses - If you invest in a rental house and actively participate in its management, you can deduct the losses from that enterprise IF your adjusted gross income is below $150,000 (it phases outs between $100,000 and $150,000. If you get married, does the phaseout double (to $300,000)? Nope - it stays at $150,000. Advantage - FILING SINGLE
4) Social security income - Your social security is taxable if you are single and you have total "modified" income of more than $25,000. Does it go to $50,000 if you get married? Nope - only $32,000. Advantage - FILING SINGLE.
This is also one of the reasons why many seniors who find a partner after their first spouse dies, live together but never marry.
5) Last but not least is the Obama's "end Bush tax cuts" proposal - he wants to end the Bush tax cuts for families (read married filing jointly) making more than $250,000, or for individuals making more than $200,000.
http://content.usatoday.com/communities/theoval/post/2011/11/obama-gop-prepare-new-battle-over-bush-tax-cuts/1
I guess I don't need to tell you that Obama is discouraging married filing joint status, do I?
