The Cash Elephant in the Room: The Tax Time Feud for Couples

     Some of us aren't very lucky and we don't get a huge refund, but depending on the dynamics of our relationships and our financial situation we might.  While you have to love getting a giant wad of cash to make you feel better about your broke moments through the year, for many modern couples (and traditional ones) this will DESTROY YOUR RELATIONSHIP!!! (or put a tiny bit of strain on it, like maybe a strained pinky finger or a strained chin muscle).

So why modern couples in particular????

     Modern couples face many decisions and one of those decisions is if they want to get married.  If they decide not to or can't because they haven't officially completed their divorce paperwork odds are they will file taxes separately.  On top of that, modern couple statistics make them look bad because they get most of the previous guests from Maury  So here are a few bumps in that road:

1. Who gets to claim the tax credits (government slang for mouths you both feed)?

     You both feed it, buy clothes for it, and kindly let them off their share of the electric bill.  Now, who exactly gets the credit for that?  You are both equally broke because you took care of it, so whose name goes on the fat check and who does the IRS laugh at every time a single person with no dependents naively logs in to do their taxes online?

Your Refund Will Be Huge!  

     As for other credits that don't eat all year, please raise your hand if you had your job hold out taxes assuming that you would be claiming those credits?  Earned income?  Head of household?  Well, it looks like you should have discussed this sooner.  You can't both claim some credits if you have the same address, so now lovingly and thoughtfully decide who gets a big check and who gets garnished next year.

2. Tax time is a great time for large purchases, so exactly whose name is this going in?

     For those who do get a large tax return tax time is a season of spending.  Sure, a lot of us will fork over a huge chunk of that money to bargain outlets to buy the absolute most junk we can pack into our plug in hybrid we got a tax credit for.  In fact, when taxes get delayed stores like Walmart that cater to this kind of behavior will actually change what they display because we are broke and worry about how their bottom line will be affected by people not having free money to throw around.  On the other hand, some of the poor people credits are actually given to poor people who can't afford to make large purchases like cars or houses (trailers) any other time of year.

Come on tax time!

     So, if we use this money for a large purchase but we filed separately because of our new age wishy washy nonsense, whose name is that going in?  Even for the most romantic, convinced of soul mates couple there is always a niggling voice that if you split up and aren't married the person whose name is on it gets to keep it.  So right now at least some of you completely disagree and are convinced that this article was not written by a certified how-taxes-break-up-relationships expert and on that, Sir or Madam, you are right.   I even disagree with me....  But somewhere there is someone who does not, so take that whoever certifies experts on this subject.

3.  Wait.....  Whose name is WHAT going in?!

     The truth is that you are lucky if you get to the point where you get to argue about whose name something goes in.  Really, it isn't entirely unlikely that you will have an even bigger fight deciding what to buy to put in someone's name.  For people whose income is low enough to qualify for those really big credits especially a few thousand dollars can be a really big deal.  That said, even if it is a really big deal to them it isn't actually enough money to make more than one really large purchase (or one down payment for one purchase that higher brackets would consider large).  

"Come on Babe! We will only have 36 payments left!"

So what does this mean?

     I'm not one to tell you what to do, but if you were the lucky duck that got to claim all the credits maybe you should use the money to start a new life in Mexico in your new trailer.  Either that, or compromise.  Neither of you should get what you want in the best interests of your relationship and you should use your stack of cash to contribute to my blog.