	Article Directory		Article Submission Service		Article Marketing Blog		Publishers		Member Log In

Article Directory :: Finance & Investment Articles

If Your Spouse has Credit Issues - You May Want to File Income Tax Separately

By John Rasor

Republish: EasyPublish™
Published: 07May2009
Word count: 441
Viewed: 109 time(s)

Get Free Content For Your Site

While filing together seems like a "couples" thing to do, your circumstances rather than your emotions should be the deciding factor. This is especially important if you're in a new marriage - a marriage of individuals who had a life, a credit rating, and legal entanglements long before they met.

If your new spouse happens to have unresolved issues with the IRS, you definitely need to file separately. These issues could include unpaid income taxes or unpaid child support.

When you file jointly, the IRS instantly views the two of you as one entity - which means even your separate bank accounts are subject to seizure - along with any income tax refund you might have been expecting.

You could also find a lien placed on real property you own - even though your spouse's name is not on title. And of course, any tax liens show up on credit reports - yours as well as your spouse's.

This could destroy your credit rating, and any plans you - or you as a couple - might have for purchasing a new home, or even a new car.

If you file separately, your finances will remain separate as long as you don't jointly sign for a loan or a credit card. Thus you can retain the equity in your real estate, still have cash in your separate bank account, and still have the credit score to allow you to make that purchase in your name. If you're intent on your spouse being on title with you, you can do it later - after the legal problems are solved.

So while filing together may seem like the thing to do when you're a couple, having one spouse's money protected and his or her credit rating in good shape will be more beneficial to your marriage in the long run.

Aside from the credit issue, you may save money by filing separately. Unless you have children and need to qualify as "Head of Household," you really should look at the issue from both directions.

Because some expenses are deducted based on a percentage of your income, it could be beneficial to allocate those expenses to the spouse with the least income - reducing their tax debt to near zero. That, of course, will depend upon other allowable deductions. You may be better off taking the standard deduction instead of wrestling with the numbers.

If you have no issues with the IRS, take the time to figure your taxes both ways and see which is most beneficial to you. A good tax accountant can help you understand all the issues and make the right decision.

http://www.creditscorecowboy.com is the #1 source on the planet for a free credit report, identity theft software and a blog with a wealth of information writtten by lending professionals that know about credit and what determines ones creditworthiness.

EasyPublish™ this article - publishers click here