Dual income couples, how do you split the taxes ?

[Russell]

Since I've made more money than DW in the past I've always been the one to pay the year end taxes. However, with her recent promotion we're not that far off anymore so I'm wondering how you guys manage/split the taxes ?

[tomkat]

Re: Dual income couples, how do you split the taxes ?

Until a couple of months ago, I made more than DH, because I had a second job in which I was considered a contractor. No taxes were taken out of my check. So, when the tax bill came a couple of years ago, I paid it since it was my second income that made us owe in the first place. I proceeded to adjust my withholding at my primary job so that more taxes could be taken out , and the following year we got a refund.

[jmjj215]

Re: Dual income couples, how do you split the taxes ?

Do you handle all your expenses separately?

[Russell]

Re: Dual income couples, how do you split the taxes ?

Good question, yes, we seperate expenses for e.g. I pay the rent, car insurance etc and the DW pays for the day care, groceries etc.

We have joint accounts as in I could write a check using her checkbook and she could do the same with my accounts...but we don't pool the money into a single account - how do you guys do it ?

[cercis]

Re: Dual income couples, how do you split the taxes ?

We got married right out of college and immediately moved to a new area. Which meant new bank accounts. So, we just combined everything. It's much easier, for us.

So when it comes to taxes, we pay out of the joint account.

If we kept separate accounts, I guess I'd make a spreadsheet and show how much each person made, how much they had deducted for taxes (so paid already) and figure out a percentage that way.

[PrincessPerky]

Re: Dual income couples, how do you split the taxes ?

We are of the 'yours is mine theory' easier and how we feel. (less work!!!!)

If there were seperate accounts, I would go with who has it to spend, but then I am not all that particular about 'keeping score'

If you MUST know, figure out what part of the taxes are yours and you pay that and she figures out what part are hers and she pays that, bit of a pain, but if you gotta know.

Or figure them out seperate and then joint, split the savings (if there is any!), subtract it from your and her seperate toatal and each pay that. (since you both are contributing equaly to the marriage stuff, or well guess I am assuming that part .)

[Russell]

Re: Dual income couples, how do you split the taxes ?

It sounds like most of you guys here have a single joint account which pools the money from both paychecks and each takes from it as needed ?

It sounds simple enough but I can see some problems with it that we currently don't have. For e.g. if she wants to splurge and buy the 120th pair of pointy toed shoes or if I want to buy the next car part we can do so within our boundaries. Of course, we discuss any big purchase but for small stuff we don't have to worry about who buys what and how often.

I asked the question because we're trying to adjust our income tax withholdings for next year so that we end up owing a little bit to uncle Sam. We figured it out using percentages. So if she makes 80% of what I make we take the 80% of the "total taxes owed" and divide it 50/50. We have our income tax withheld based on that 50/50 and at the end of the year I pay the left over 20% because that's my share of the taxes. Pretty simply actually.

[jmjj215]

Re: Dual income couples, how do you split the taxes ?

It sounds simple enough but I can see some problems with it that we currently don't have. For e.g. if she wants to splurge and buy the 120th pair of pointy toed shoes or if I want to buy the next car part we can do so within our boundaries. Of course, we discuss any big purchase but for small stuff we don't have to worry about who buys what and how often.

If you operarte w/in a budget that includes all income in one pool, and you budget discretionary income to each other for which you are not accountable to the other person (and that limit varies w/ circumstance), that problem of having a joint account goes away because you've agreed on the budget at the beginning of the month (and have some personal leeway with the his/hers money).