“Damnit, I thought I was done with paperwork. What else do I need to fill out or update?”
You mean you don’t love filling out official paperwork? Truth be told, no one ever gets fired up about the pile of forms associated with any major life event. But since that paperwork can result in a lower tax bill and other savings, attack these forms like you’d attack your mother-in-law if she questions your career goals for the umpteenth time. (Just kidding. Don’t attack your mother-in-law, even if you want to.)
Social Security: If you take your spouse’s last name – or create a combination of both your names, it being 2015 and all – you’ll need to visit the Social Security Office to change your name. If you file your name change with HR but neglect your Social Security office visit, you’ll have problems processing your tax return and subsequently, delay your refund. So if you’d like your cash, make this update sooner rather than later.
W-4 Form: Don’t forget to update your W-4 form with your employer when you return from your honeymoon. Depending on you and your spouse’s work situations, you can adjust the number of allowances you’re entitled to: use the IRS withholding calculator to see whether it makes sense to withhold more (more taxes taken from your paycheck; bigger refund in April) or withhold less (fewer taxes taken from your paycheck; bigger tax bill in April).
If you and your new spouse are now filing jointly (link to Uncle Sam/Marriage article), you may also qualify for a lower tax rate and a bigger deduction.
Having a Baby
Social Security: Braving the lines at the Social Security Office to change your name was traumatizing enough; it’s even less appealing with a screaming infant in tow. Do yourself (and the old folks with hearing aids) a favor and apply for Junior’s Social Security number before you even leave the hospital. You can apply when you request a copy of your baby’s birth certificate. A Social Security number is pretty important for your baby’s first financial steps: you need one to claim your baby as a dependent on your income tax, open baby’s first savings account, buy savings bonds in your child’s name, and apply for medical coverage or government services for your child.
If you hold off applying for baby’s Social Security number, you’ll not only wait in line at the Social Security Office, but you’ll also wait up to 12 weeks to get the card as the Office verifies both your identities and citizenship statuses. Because insurers typically give you a 30-day window to add your baby to your health insurance policy, you risk blowing past the enrollment period while waiting for your newborn’s Social Security card. And what would your mother-in-law say to that?
W-4 Forms: And if you thought you were done with W-4 forms, think again. You’ll need to adjust your allowances and add your bundle of savings … er, bundle of joy… as a dependent. Many taxpayers saw income reductions of $4,000 in their taxable income after baby’s arrival. If your filing status is Single, you may now also qualify for a Head of Household filing, which lowers your tax bracket and gives you a higher standard deduction.
Paperwork is annoying - we get that. But filing these forms in a timely manner will spare you IRS headaches down the line. No guarantees for that mother-in-law of yours though.
Photo: Thomas Leuthard