5 Tax Benefits That Come With Marriage


Spousal IRA

You can even deduct contributions to your spouse's retirement account.
You can even deduct contributions to your spouse's retirement account.
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Individual Retirement Accounts (IRAs) are good stuff. With an IRA, you can make tax-deductible contributions to a retirement savings account. That means you can put money away in your IRA account -- up to $5,500 a year for most taxpayers -- before taxes. The trick with an IRA is that it's an "individual" retirement account. Under normal circumstances, you can only deduct contributions that you make to your own IRA, not someone else's. But here's where married couples get a break. If you meet certain conditions, you can pay money into your spouse's IRA and deduct up to $11,000 on your joint tax return.

First, let's look at those "conditions." If you and your spouse's total AGI is more than $178,000, you can't deduct the full $11,000. Also, there's the matter of other retirement plans. If both spouses participate in an employer-sponsored retirement plan in addition to your IRAs, then the income phase-out range drops down to $95,000 to $115,000 for 2013 [source: IRS]. The feds figure that if you have a second retirement plan, you don't need so many deductions.

The good news is that there are no income restrictions at all if neither spouse has an employer-sponsored retirement plan. And there's even better news if you or your spouse are 50 years or older. If you're 50 or older on December 31, 2013, you can deduct up to $6,500 a year in IRA contributions or a combined $13,000 per married couple [source IRS]. Consider this the IRS's way of saying "Happy Retirement!"

For our final tax benefit of marriage, we attempt to dodge the bullet of the capital gains tax.