6 Conversations to Have with Your Spouse Before Tax Season
When you’re working on your tax return each year, it’s tempting to get through it as quickly as possible, then forget all about the stress it caused.
But tax season is actually a great time to take a look at the year that’s behind you and use that information to plan for the years ahead—especially if you’ve made some major transitions in your life.
If you’re newly married, new parents, or new homeowners, for example—or expect to be sometime soon—your tax situation may change. And so, by extension, will the ways you budget and invest for the future. Look at it as an opportunity to sit down with your spouse, maybe with a glass of wine, and strategize.
Therapists might call this kind of talk a “difficult conversation.” But it doesn’t have to be. Don’t think of it as a fight about money or mistakes you’ve made. This is about the goals you’re setting together and how you’ll attain them.
And as you’re reading, please note that the concepts featured here are to help you get the conversation started, and should in no way be construed as tax advice—see your tax professional for that.
Here are six topics to consider:
1. Should You and Your Spouse be Filing Jointly?
The IRS doesn’t require a married couple to file a joint return , but joint filers generally are given higher income thresholds for certain taxes and deductions.
So, if you and your spouse are both high earners, for instance, you’ll potentially qualify for more tax breaks and better tax rates if you file jointly than you would if filing individually.
However, though married filing separately has disadvantages, filing jointly isn’t always the best choice. If you have time, you might want to consider preparing your taxes both ways—married filing jointly vs. married filing separately—to determine which is less expensive.
Even if the tax bill is lower, there are other factors to keep in mind. You may wish to keep your finances separate in the eyes of the federal government, particularly if one spouse is paying back their loans on income-based repayment plan. If you file jointly, their payments may go up because they will now be based on your joint income.
2. Did You Just Have a Baby?
Congratulations! It might already be time to start saving for your kid’s future.
It may seem a tall order when your little one is costing you so much money right now, with diapers, daycare, and other infant accoutrement.
And you may have panicked a bit when you learned the Tax Cuts and Jobs Act of 2017 got rid of personal exemptions.
But on the plus side, the child tax credit has doubled , and tax reform didn’t take out the child and dependent care credit , either. All of these tax credits and cuts are nuanced and discussing them with a tax professional can help. If you’re not sure how having a baby is going to affect your taxes, check in with your tax accountant.
3. Did You Buy a House?
If this is your first home purchase, you might love what owning a home can do for your taxes . For many, the tax breaks you get if you itemize on your return are an exciting part of home ownership. Tax reform put new limits on what homeowners can claim on their returns, so make sure you’re up to date on all the rules.
4. Are You Ready to Pay Off Some Debt?
Unfortunately, you can no longer deduct the interest on the portion of a home equity loan used for non-home-improvement debt, such as buying a car, student loans, or paying off credit cards. You may want to look at consolidating your debt, instead, or perhaps use a personal loan that has a low interest rate and manageable payments.
The IRS will allow you and your spouse to claim a student loan interest deduction of up to $2,500 annually, as long as you and your student loans meet certain eligibility criteria , so keep close track of your payment records.
5. Are You Looking to Move up or Move on For a New Job?
If you’re looking to move up in your career, you may have to relocate for your next position. That sounds exciting, but remember: Moving costs can run into thousands of dollars. It’s something you’ll have to budget for.
And unfortunately, the deduction for those relocation costs was eliminated (except for military jobs) at least through 2025. If relocating is in your plans—for a transfer or new employer—it’s more important than ever to talk to your company about what it will cover.
6. Are You Saving For Retirement?
Yes, you just paid for a wedding. Or a house. Or, you just had a baby. Still, it’s critical that you get your investment savings started. Both of you. Stat.
The longer your money stays invested, the more time compound interest has to make a difference in your bottom line.
If you already have a tax-deferred investment savings account at work (401(k), 403(b), etc.), make the most of employer match . If you’re self-employed or have a side gig, look at opening a traditional IRA.
Roth IRAs are also available. While a Roth IRA contribution won’t provide an immediate tax advantage , if you meet requirements, it will produce an income stream in retirement you don’t have to pay taxes on. And if your tax rate in retirement is the same or higher than it is now, you’ll be so grateful.
You and your spouse can’t have a joint individual retirement account, but you can designate each other as beneficiaries. Be sure to update that information on all your accounts.
Using SoFi Money™ to Help Budget
All this calculating and saving and planning probably feels like a lot. And it is. But once you get started, you’ll find there are plenty of ways to help you get on track and stay there.
One solution is to look around for a simplified joint cash management account like SoFi Money™.
SoFi Money could be a great resource if you and your spouse are shopping for a joint place to better consolidate your finances. Sometimes having too many accounts can create a lack of organization, so using one, convenient cash management account like SoFi Money can make things a little easier.
With SoFi Money you can spend, save, and earn all in one product. And the mobile app makes it easy to watch your spending.
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