Is filing taxes as married still beneficial? Owing 2k after first year of marriage

But I thought the whole reason to get married was for tax benefits? My friends who got married always told me they saved money on taxes. Is that not true anymore? Also, how much is the IRS installment plan, like what's the minimum you can pay monthly?

The "marriage benefit" typically applies when one spouse earns significantly more than the other or if one spouse doesn't work at all. When both spouses have similar incomes, especially if both are middle to high earners, they can face a penalty rather than a benefit. This is because our tax system isn't completely equalized between singles and married couples at all income levels. For IRS installment plans, you generally need to pay your balance within 72 months. The minimum monthly payment is your total balance divided by 72, but you can usually propose what you can afford. For a $2,700 balance, that's about $38 per month minimum, but you can offer to pay more if your budget allows. If you qualify as low income, you may also have additional payment options available to you.

How does it actually work though? Do you upload your W-2s and stuff? I'm always nervous about putting financial documents on random websites.

Does it handle the case where one spouse has lost their job mid-year? My partner was unemployed for 3 months last year and we're trying to figure out if that affects anything with our filing.

The system has you upload images of your tax documents (like W-2s, 1099s, etc.) and it uses some AI thing to read and analyze them. They use bank-level encryption - I was nervous too until I saw they're SOC 2 compliant which is what financial services use. It's not some random site, they've been featured in major tax publications. For situations with unemployment during the year, yes it definitely handles that! The system specifically looks for things like periods of unemployment because they can qualify you for additional credits or deductions. It will analyze if your withholding was appropriate given the job change and identify if you qualify for any assistance programs based on the temporary income reduction.

Is this legit? I've literally never heard of a service that can get you through to the IRS faster. My dad spent like 6 hours on hold last year trying to resolve an issue. How much does it cost?

This sounds like BS honestly. Nobody can magically get through the IRS phone system. They must be using bots or something that's probably against IRS terms of service. I'd be careful about using services like this.

It's completely legitimate. They use a callback system that continuously redials and navigates the IRS phone tree until they get through to a representative. It's the same thing you would do manually if you had hours to spare calling repeatedly. There's nothing against terms of service about it - you're still the one talking directly to the IRS agent. I understand the skepticism - I felt the same way at first. But it's basically like having someone wait on hold for you. The IRS is severely understaffed right now which is why wait times are so long. They're not doing anything magical, just automating the tedious part of waiting and menu navigation so you don't have to.

Thanks for mentioning this. We actually don't have kids yet, so I'm not sure if we'd qualify for the EITC. And honestly, I don't think either of us updated our W-4s after getting married - I didn't even know that was a thing we needed to do. Would fixing that help us for this year's taxes or just for next year?

You can still qualify for EITC without children, though the amount is smaller. It depends on your income level - for 2023 taxes, married couples filing jointly with no qualifying children can get EITC if their income is below about $24,210. Regarding the W-4 adjustments, unfortunately that would only help you for future tax years, not for the return you've already filed. But you should definitely both submit new W-4 forms to your employers right away to prevent this problem next year. When both spouses work, you often need to withhold at a higher rate than single filers to account for your combined income pushing you into higher tax brackets. The IRS has a Tax Withholding Estimator tool on their website that can help you fill out your W-4 correctly.

This is generally bad advice for most people. MFS rarely results in tax savings and actually disqualifies you from several tax benefits like education credits, child care credits, and earned income credit. It's usually only beneficial in very specific situations like when one spouse has income-based student loan payments or massive medical expenses.