If you recently married or divorced, you are probably not thinking about taxes. However, you need to sooner rather than later to ensure tax compliance as a newly married couple or as a newly single individual.
1. Inform the Social Security Administration of your name change. If you changed your name after a recent marriage or divorce (or if you hyphenated your last names), you to take the necessary steps to ensure the name on your tax return matches the name registered with the Social Security Administration. A mismatch between the name shown on your tax return and the SSA records can cause problems in the processing of your return and may even delay your refund.
To update your Social Security details, fill in Form SS-5, Application for a Social Security Card, at your local SSA office or by mail and provide a recently issued document as proof of your legal name change. The form is available on Social Security Administration’s Web site at http://www.ssa.gov or by calling 800-772-1213 or at local offices. Your new card will have the same number as your previous card, but will show your new name.
If you adopted your spouse’s children after getting married and their names changed, you’ll need to update their names with SSA too. For adopted children without SSNs, the parents can apply for an Adoption Taxpayer Identification Number – or ATIN – by filing Form W-7A, Application for Taxpayer Identification Number for Pending U.S. Adoptions with the IRS. The ATIN is a temporary number used in place of an SSN on the tax return.
2. Inform the IRS and U.S. Postal Service of a change of address. Avoid missing any IRS correspondence. To update your address with the IRS, fill in Form 8822, Change of Address.
3. Inform your employer of your change in marital status, name change and change of address. This will ensure you receive your Form W-2 Wage early next year.
4. Determine your tax filing status. Depending on when you were married or divorced, your filing status may be single, married filing jointly or married filing separately. In some circumstances, you can choose the most beneficial filing status, based on your individual earnings and tax obligations, that will allow you to pay the least amount of taxes. Additionally, there may be other reasons why one filing status maybe be better under your individual circumstances.
5. Determine your withholding amount. If you choose to file jointly as a newly married couple, your combined salaries may put you in a higher tax bracket. If you are newly single, your tax bracket may also change. Thus, your withholding amount may need to change. You can calculate the amount you should be having withheld by using the IRS Withholding calculator. Once you have determined the correct amount, fill out a new Form W-4, Employee’s Withholding Allowance Certificate, and provide it to your employer so the correct amount is withheld from your pay.
If you need assistance with any of these issues, please contact us.