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COMMENTARY: Three reasons why gay couples should not marry

The U.S. Department of the Treasury has now declared that legally-married same-sex couples are receiving federal tax recognition regardless of what state they live in. But with all the excitement, it is important to take a step back and consider whether getting married is the right step. There are actually some situations in which it is better not to get hitched, or at least to take your time and be certain that the positives will outweigh the negatives.

Married couples are able to take advantage of many benefits that help their finances in the long run. However, here are three instances in which one or both partners could be worse off once they get married. These are: 1) you become liable for your partner’s debts; 2) the income tax “marriage penalty;” and 3) your income becomes community property, which means giving up some control.

It is crucial that couples spend time talking about how they handle their finances, before tying the knot. If your partner is prone to debt, watch out – you will be on the hook for their debts once you are married. If that is a difficult conversation to initiate, it can sometimes help to meet together with a financial advisor, whose objective view can help mediate and make it easier to address sensitive issues.

For couples in which both partners have high incomes, welcome to the marriage penalty – something that tax reformists have been moaning about for years. Starting when both partners in the 28% tax bracket or higher, you may actually pay more in taxes together than you would singly. At the very least, it is something to review with your tax preparer so that you know what the impact will be, and possibly find some ways to alleviate it.

Lastly, in states like California, once you are married your income is considered community property. So each partner automatically receives 50% ownership of any asset that is purchased or accumulated with each other’s income. This is another area where it is important to have good communication around your values and goals for how you want your finances to be shaped as you both go forward on your joint path in life.

About Mosaic Financial Partners

The firm’s mission is to improve their clients’ lives by providing caring, knowledgeable financial solutions and customized advice to help their clients attain their lifetime goals and aspirations. Committed to helping businesses, families, and individuals in the greater Bay Area, MFP's integrated team empowers all members of the community to make personal financial decisions and achieve their dreams. For more information about MFP, go HERE or call 415-788-1952.

Steve Branton's biography can be found HERE.