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Cupid says note year-end marital status; Reindeer Year-end Tax Games Tip #6

December 18, 2012

Unless you're a couple of tax professionals, the Internal Revenue Code probably had very little to do with your courtship.

But the truth is, taxes can be a big part of every relationship.

For most of us (and soon maybe more of us after the Supreme Court hears an estate-tax related same-sex marriage case), our tax laws have an effect on us once our relationships move to the "I do" phase.

That's why Santa's romantically-named reindeer Cupid reminds us that our marital status on Dec. 31 determines our filing status for the whole tax year. These wise words are Reindeer Year-end Tax Games 2012 tip number six.

Reindeer love courtesy Brothersoft Windows software Reindeer Love courtesy Brothersoft

That's right. If you and your sweetie zip off to Las Vegas and tie the knot in one of Sin City's famous wedding chapels on Dec. 31, then Uncle Sam considers you married for the full year.

Marriage tax penalty could be back: That might be something to think about in 2012. Right now, the tax laws ameliorate the marriage tax penalty.

This penalty is a bigger tax bill that some couples faced when they filed a joint return. If they had just filed as two single taxpayers, the total of the two separate amounts they owed the U.S. Treasury would have been less than their one wedded tax bill. 

The Bush-era tax laws evened things out a bit, widening tax brackets and making the standard deduction for a married couple twice that of a single filer.

But if we fall off the cliff, legally hitched couples can add the marriage penalty to the list of tax troubles they'll face.

So you might want to think about moving up the ceremony so you can at least be sure you'll have one return filing together without a big marriage tax penalty.

Divorce on Dec. 31: The year-end relationship status also works the other way.

If you were married for the full year and your divorce became final on Dec. 31, then the Internal Revenue Service considers you a single taxpayer (or head-of-household if you got the kids in the breakup) for the full tax year, not just for one day.

Now Cupid and I aren't saying you need to take tax laws into account when it comes to matters of the heart. But it doesn't hurt to know that they could have an effect.

You also might find these items of interest:

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The More Tax Posts tab at the top of this page will take you to, well, more tax posts. You also can search below for a tax topic. 

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TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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