Marriage | robergtaxsolutions.com

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Wait right there. I can hear you through the computer. “How stupid does she think we are?” “Who doesn’t know how to put their name on a tax return?” “I’m not a moron you know.”

Yes, I know you’re not a moron. (And no, I can’t really hear you through the computer, I’ve just dealt with this issue enough that I know what people generally say.) For 99.9% of you, you put your name on the tax return and that’s it—no problem. But there’s always that small number of people every year whose tax return gets rejected because, according to the IRS, their name is wrong. This is about fixing those returns.

Number 1: Often when you get an IRS “name error” message, it’s not your name that’s the problem at all. It’s your social security number. Check that first to make sure you didn’t transpose a number. If that’s the problem, you may need to re-input your whole tax return. My current software lets me correct a bad SSN, but I used to use one that made you do the whole return over. That’s not fun.

Number 2: You didn’t change your new married name with the Social Security office. Many women get married and change their names. They tell their friends, they tell their work, but they forget to do it officially with Social Security. When they file their tax return with their new married name—reject! They don’t exist. You’ll need to file the return with your old name on it. You can still do file as married, you’ll just use your maiden name. Then go to Social Security and give them the new name. Here’s information on how to do that: http://ssa-custhelp.ssa.gov/app/answers/detail/a_id/315/session/L3RpbWUvMTM4Mjc5MzQ0Ny9zaWQvKkRTVzFNRGw%3D

Although it will only take about 10 days to get your new social security card, it will take about 8 weeks to get your name into the federal computer system. If you’re looking for a refund, or have a filing deadline, just use your old name for now and the new name next year.

Number 3: You really spelled your name wrong. You’d be surprised how easy this is. We double check our numbers –of course, it’s taxes. But we don’t double check spelling our names. Why would we, it’s our name? We know that. But you know how it goes, “tiye dubfwea di ib rgw qeibf jwta”. I mean, your fingers go on the wrong keys.

Number 4: If you’ve double checked your SSN, and your name is spelled correctly and you’re not recently married and you’re still getting a reject notice—you’ve got to pull out your actual social security card as see what it says. On newer social security cards, the last name is printed under the first and middle names. For example, Hillary Clinton’s return might be getting rejected because it should really say Hillary Rodham Clinton on it.

Number 5: It’s wrong at the IRS. It’s possible. If you’ve checked everything on this list, including pulling out the actual SS card and checking everything and you still have the “wrong” name, you can still paper file the tax return, just to get it submitted. You’ll still want to follow up with the IRS and Social Security and get your name fixed. If you’ve filed returns before, you can get a transcript of your old return from the IRS. Your transcript will have the name that the IRS has for you on it. Here’s a link for that: http://www.irs.gov/Individuals/Order-a-Transcript I know that sounds a little crazy, and even impossible, but I had to do that to once. Well, I knew the person’s name, but the IRS had something completely different!

One final name issue for people who paper file their tax returns: don’t forget to put your name on the tax return. Really! It’s one of the most common mistakes. People who e-file—you can’t forget to do that. People who paper file, they often do all of the math and plan on adding their name last. Then they finish their return and forget to put the name on. Back in the Stone Age when I was taking the income tax prep class, it was an automatic failing grade to not put a name on the return. I thought it was silly (they were fake names on fake returns!)

If you file a tax return with no name on it, then that means it’s not filed. If you don’t file your tax return on time, there’s a penalty of 5% per month of the tax you owe, up to 25%. If you’re expecting a refund, it won’t come. These returns just go into the trash. And yes, this still really does happen. I’ve had people come to my office with IRS letters telling the people they never filed. The taxpayer shows me the photo copies of his mailed tax return to prove he filed and right there in black and white is a blank space for the name. It’s a really easy mistake to make. It happens quite often (or I wouldn’t bother to write about it.)

Photo by Guillaume Paumier at Flickr.com

First the Supreme Court overturned DOMA. Now the IRS has announced that no matter what state you live in, if you are married and gay, you should file as married filing jointly on your federal income tax return. Now the big question for everyone is: Should you amend your old tax returns?

The answer, in my best professional opinion, is MAYBE. If you read my blog posts very often, you saw that one coming didn’t you?

For some couples, filing jointly is going to help them out and get them a refund. If you’re a couple that’s entitled to a refund—AMEND! For some couples, filing jointly is going to have them paying more in taxes. To those couples I say—DON’T AMEND. You really do have a choice here because you filed your original return using the law of the land at the time of the filing. You are not required to amend your return because DOMA was overturned. You are allowed to amend your return. There’s a big difference.

An accountant friend of mine in Iowa has been working with some of his gay married clients and he’s finding that about 75% of his clients would lose money or stay close to the same amending their returns. Only about 25% of them would profit from it.

So how do you tell which category you fit into? Generally, a couple with a big difference is incomes—for example, one spouse stays home to care for the household while the other is the primary breadwinner—that couple is more likely to benefit from filing jointly. On the other hand, a couple where both spouses work and their incomes are close together could find themselves kicked into a higher tax bracket. They could really lose out filing together. Tax returns for families with children can go either way. I’m an accountant geek, so I say just run the numbers.

It makes a lot of sense to run the numbers because the new tax ruling is going to affect all of your future tax returns as well. If filing jointly is not to your advantage, it’s better to learn that now so you can adjust your withholding. Here’s a link to my Tax Tips for Newlyweds: http://robergtaxsolutions.com/?s=tax+tips+for+newlyweds. You may have been married for a couple of years, but never gotten to file a federal return as being married before so you might not have needed these tips before.

One more thing—if you’re in a state that doesn’t recognize gay marriage, you still might not be able to file a joint state return. Couples in gay marriage states have been dealing with the opposite problem for a few years now. They file joint state returns but then file a separate federal return. I suspect we’ll be seeing a lot of separate state returns for awhile. It’s going to take some time for lawmakers to make up their minds on that.

So, do you wait to see how your state legislature is going to handle the issue before amending? I say no. Go ahead and file your federal amendments. If the state changes, you can fix those later. I worry about people waiting too long and then missing out on their refund because they didn’t file the amended return on time. Unless the IRS grants some type of special extension, you only have until April 15^th of 2015 to amend your 2010 income tax return.

If you need help determining if you should file an amended return or not, please contact our office. We can help you figure out if it’s worth your while or not.

Tag: Marriage

Married and Gay: Should You Amend Your Tax Returns?