Marriage is a deeply personal decision, but it also has significant financial and tax consequences. While love should be the driving factor in deciding whether to tie the knot, the tax implications of marriage should not be overlooked. In some cases, getting married can result in higher tax bills or unexpected financial liabilities. Before you make the leap, here’s what you need to know about when marriage might not be the best financial decision.
Married at Year-End Means Married for the Whole Year
Your marital status on December 31 determines your tax filing options for the entire year. If you are married by that date, you only have two choices for filing:
- Married Filing Jointly (MFJ)
- Married Filing Separately (MFS)
Most couples file jointly because it is simpler and often results in a lower tax bill. However, that is not always the case.
The Marriage Penalty: When Getting Married Costs You More in Taxes
The so-called “marriage penalty” occurs when a married couple pays more in taxes than they would if they remained single. While the Tax Cuts and Jobs Act (TCJA) eliminated most marriage penalties through 2025, they still exist at the highest tax bracket.
Example 1: Marriage Penalty for High Earners
- 2024 tax brackets: The 37% tax rate applies at taxable income levels above:
- $609,351 for singles
- $731,201 for married couples filing jointly
- If two individuals each earn $600,000 and stay single, neither would be taxed at 37%. However, if they marry, their combined $1,200,000 income means that $468,800 of it would be taxed at the higher 37% rate—a clear marriage penalty.
Example 2: Unequal Incomes and the Marriage Penalty
- Person A: $900,000 taxable income
- Person B: $300,000 taxable income
- Total combined income: $1,200,000
- If single: The 37% tax rate only applies to Person A’s last $290,650.
- If married: The 37% tax rate applies to $468,800 of their combined income.
- Result: More income is taxed at a higher rate due to marriage.
Joint Liability for Spouse’s Tax Issues
Filing jointly means both spouses are jointly and severally liable for any tax underpayments, penalties, or fraud committed by either spouse. This means the IRS can come after you for 100% of unpaid taxes if your spouse cannot pay—even after a divorce.
- If you have concerns about your partner’s financial habits, consider filing separately or delaying marriage.
If the IRS claims fraud, you must prove you were unaware to qualify for the innocent spouse rule—which is difficult to do.
Filing Separately: Pros and Cons
Choosing Married Filing Separately (MFS) can protect you from joint tax liability but often results in a higher tax bill because:
- Many deductions and credits are phased out or eliminated, including:
- Education tax credits
- Student loan interest deduction
- The ability to contribute to a Roth IRA
- The tax brackets for MFS are less favorable, meaning higher taxes on income.
Example 3: Higher Tax Rates for Filing Separately
- Single filers pay 35% tax on income above $609,351.
- MFS filers pay 37% tax on income above $365,601.
If you have $600,000 of taxable income and file separately, you pay more in taxes than if you stayed single.
Marriage Can Affect Eligibility for Key Tax Breaks
If you or your partner have a large income disparity, marriage could eliminate valuable tax credits.
Credits and Deductions That May Be Reduced or Eliminated by Marriage:
- Child Tax Credit
- Education Tax Credits
- Adoption Tax Credit
- $25,000 Passive Real Estate Loss Deduction
- Qualified Business Income (QBI) Deduction
For example:
- If one partner earns $50,000 and the other earns $500,000, the lower-earning spouse might lose access to student loan deductions and tax credits due to the combined income exceeding phase-out limits.
- If a self-employed individual relies on the QBI deduction, marrying a high-income spouse could reduce or eliminate this tax break.
The Marriage Bonus: When Marriage Lowers Taxes
While many high-income couples suffer from the marriage penalty, some situations result in a marriage bonus, where a couple pays less in taxes after getting married.
Example 4: Marriage Bonus for Unequal Earners
- Person A: $1,150,000 taxable income
- Person B: $50,000 taxable income
- Total: $1,200,000
- If single:
- Person A pays 37% tax on the last $540,650 of their income.
- Person B’s max rate is 22%.
- If married:
- Only $468,800 is taxed at 37%.
- Net tax savings: $19,615.
For couples where one person earns significantly more, the lower earner’s income helps expand tax bracket thresholds, lowering overall taxes.
Bottom Line: Should You Get Married?
Before getting married, consider:
- Does your combined income push you into higher tax brackets?
- Are you at risk of losing key deductions and tax credits?
- Would filing separately cost you more in taxes?
- Are you comfortable with joint tax liability?
- Do you or your spouse have tax issues that could cause problems?
Final Advice:
- Run the numbers before making a decision.
- If marriage results in higher taxes, consider delaying or strategizing how you file.
- For high-income couples, the marriage penalty is real—but so is the marriage bonus in certain cases.
