Gavin Howe
Whether you can file taxes jointly as a common-law married couple depends on the state in which you reside. Common-law marriage is recognized in some states, such as Colorado, and if you meet the criteria for common-law marriage in your state, you may be able to file taxes jointly and receive various benefits, such as tax deductions and social security benefits. However, it's important to note that not all states recognize common-law marriage, and in those states, you may not be eligible to file jointly or receive the same benefits as legally married couples. It's always best to consult with a tax professional or refer to your state's official guidelines to understand your specific situation and filing options.
| Characteristics | Values |
|---|---|
| Filing jointly vs separately | Filing jointly can reduce tax burden |
| Common-law marriage | Common-law marriage is valid in some states |
| Tax benefits | Common-law partners can avail of tax benefits, including tax deductions, social security benefits, and employer benefits |
| State recognition | Common-law marriage must be recognized by the state for couples to be eligible for tax benefits |
| Federal recognition | Common-law marriage is recognized for federal income tax purposes if recognized by the state |
| Massachusetts | Massachusetts does not recognize common-law marriage |
| Colorado | Colorado recognizes common-law marriage and allows common-law spouses to file jointly |
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What You'll Learn
Common-law marriage recognition
Common-law marriages are recognised in the United States, and have been since the 1870s. However, recognition of common-law marriages varies across states. For example, common-law marriages are recognised in Colorado, Georgia (if the requirements were met before 1 January 1997), Idaho (if the requirements were met before 1 January 1996), New Hampshire (for inheritance only), and Ohio (if the requirements were met before 10 October 1991). In contrast, Massachusetts does not recognise common-law marriages.
If a state recognises a couple as common-law married, the IRS will also recognise the couple as married for federal income tax purposes. This means that common-law couples recognised by their state can file joint tax returns and enjoy the benefits of filing jointly, such as a double standard deduction compared to single taxpayers, and various tax deductions including a mortgage interest deduction. Additionally, common-law partners can receive one another's social security benefits and employer benefits, such as health insurance.
To be considered common-law married, a couple must meet certain criteria. For example, in Colorado, a common-law marriage is the same as a ceremonial marriage and can only be terminated by death or divorce. In other states, a couple must live together for a certain period and present themselves as a married couple to their community, family, and friends.
It is important to note that if a couple begins their common-law marriage in a state that does not recognise such relationships, they will not be considered married for federal income tax purposes, even if they later move to a state that does recognise common-law marriages.
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Joint tax return benefits
In the United States, the Internal Revenue Service (IRS) offers various tax benefits to married couples filing jointly that are not available to other filing statuses. These benefits include:
- A joint tax return often results in a larger tax refund or lower tax liability.
- The standard deduction for married couples filing jointly is double that of a single taxpayer.
- Higher income thresholds for certain taxes and deductions, allowing them to earn more income and still qualify for certain tax breaks.
- Access to multiple tax credits, such as the Earned Income Tax Credit, Child and Dependent Care Tax Credit, and American Opportunity and Lifetime Learning Education Tax Credits.
- The ability to use employer benefits for their spouses, such as health insurance coverage.
- Eligibility for spousal social security benefits.
- Discounted auto and homeowner's insurance, better rates on health insurance, and better rates and terms on loans and credit.
To file a joint tax return, the IRS requires that the couple is recognized as legally married by the state they reside in. Couples in a legally recognized common-law marriage in the state where it began can choose a married filing status and receive the same benefits as other married couples. However, it is important to note that unmarried couples, including those in common-law marriages not recognized by their state, cannot file joint tax returns.
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Social security benefits
In the United States, the Social Security Administration (SSA) recognises common-law marriages as valid. As such, a common-law couple can claim the same benefits as a couple who followed the "traditional" marriage route. These benefits include spousal benefits, survivor benefits, and even benefits from an ex-common-law spouse.
To be eligible for these benefits, the couple must meet the requirements of a common-law marriage. These requirements include:
- Living in a state that recognises common-law marriage
- Having the legal capacity to get married (e.g., being old enough and not already married)
- Both parties intending to be married, even without a ceremony or license
- Taking actions that demonstrate this intention, such as living together, sharing income and expenses, and holding themselves out as a married couple to family, friends, and the community
It is important to note that the specific requirements for common-law marriage may vary by state, so it is advisable to consult a qualified family law attorney to understand the specific laws and requirements in your state.
When it comes to filing taxes, common-law married couples have the option to file jointly or separately. If filing jointly, the couple combines their incomes and deductions, which can result in a lower tax rate compared to filing separately. However, if one spouse receives Social Security benefits, a portion of those benefits may be taxable, and the person receiving them will have to include them in their gross income. On the other hand, filing separately may provide certain tax advantages, especially if there is a significant income disparity between the spouses. In this case, the spouse with the lower income can claim certain deductions that may not be available when filing jointly.
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Estate planning benefits
Common-law marriage has been practiced in the United States since the 1870s. It is a less formal type of marriage, where a couple may be considered married by living together for a while, presenting themselves as a married couple, and fulfilling other criteria, without a formal wedding ceremony.
The IRS treats common-law marriages on par with legal marriages, and common-law partners can file joint tax returns. By filing jointly, common-law spouses can access various tax benefits, such as tax deductions and credits, including those for having children together.
One significant estate planning benefit for common-law couples filing jointly is the unlimited marital exemption from estate planning based on the federal estate tax limit. This means that by filing a joint tax return, common-law partners can take advantage of the same estate tax exemption as legally married couples. This benefit can provide substantial financial savings and protection for the couple in the long term.
Additionally, common-law partners can benefit from shared employer benefits, such as health insurance coverage. When one spouse is covered by their employer, filing jointly allows the other spouse to be insured under the same plan. This benefit can provide essential health coverage for the uninsured spouse, ensuring access to medical care and potentially saving money on health expenses.
While common-law marriage offers these benefits, it is important to note that it also presents complexities, especially in estate planning. Seeking expert legal and financial advice is crucial to navigating the intricacies of common-law marriage and ensuring access to its full range of benefits.
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State-specific laws
Texas
In Texas, common-law marriage, also known as "marriage without formalities" or "informal marriage," is a valid and legal way for a couple to marry. There is no requirement for a couple to be together for a specific period to declare themselves in a common-law marriage. However, couples who choose not to declare their common-law marriage may need to provide documents like lease agreements, tax returns, and insurance policies to prove their marriage if a dispute arises. Additionally, registering their common-law marriage by filing a declaration with the county clerk is an option for couples in Texas.
Georgia, Idaho, New Hampshire, and Ohio
These states recognize certain older common-law marriages. In Georgia, common-law marriages are recognized if the requirements were met before January 1, 1997. Idaho recognizes common-law marriages if the elements were satisfied before January 1, 1996. New Hampshire recognizes common-law marriages for inheritance purposes only. In Ohio, common-law marriages are recognized if the requirements were met before October 10, 1991.
It is important to note that laws are subject to change, and some states may have updated their legislation since these sources were published. Therefore, it is always advisable to consult current state laws or seek legal advice for the most accurate and up-to-date information regarding common-law marriage and tax filing in a specific state.
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Frequently asked questions
Yes, if your state recognizes common-law marriages, you can file a joint tax return. Common-law partners can use employer benefits for their spouses and are entitled to various tax deductions.
A common-law marriage is a marriage that is considered valid under state law but was not formally solemnized. Common-law marriages are recognized in certain states in the US, such as Colorado, Georgia, Idaho, and New Hampshire.
Filing jointly as a common-law couple can result in tax savings and other benefits, such as social security and health insurance coverage.
The requirements vary by state, but generally, a couple must live together and present themselves as a married couple to their community, family, and friends. In some states, there are specific conditions that must be met, such as the duration of the relationship.
If you entered into a common-law marriage in a state that recognizes it, you will still be considered married for federal income tax purposes, even if you move to a state that doesn't recognize common-law marriages.
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