claiming MFJ status when unmarried

You're asking the wrong question.

For Federal tax purposes your marital status is determined on the last day of the tax year. Except for legally married same-sex couples if you are married on 12/31 under state law, you are married for the entire year for Federal tax purposes.

Some states recognize common law marriage; some do not. If you establish a common law marriage in a state where that is possible you remain married even if you move to a state where you couldn't establish such a marriage.

For legal purposes a common law marriage is the same as one with a license and a ceremony. You're married until you divorce or the marriage is anulled. IOW, it's not a "I think we'll be married this year" proposition.

For certain in no case would you become married simply by filing a joint tax return. Remember that your marital status was determined the prior December

2. Married people file either Married, Filing Jointly or Married, Filing Separately. (Same-sex married couples file Federal returns as Single or Unmarried Head of Household.) Under certain circumstances a person legally married may be "considered unmarried" for Federal tax purposes. See IRS Publication 501.

Of course, the answer is "It depends".

As a strong advocate of "Living in Sin for Fun and Profit", I can tell you there are some problems in common-law marriages. In order for there to be a common-law, there MUST be a clear present-tense agreement to be married

The IRS is prone to attack CLM's because they represent unpaid taxes plus interest, and penalties. In the case of a Utah couple, the IRS successfully attacked the CLM.

One the other hand, a CLM may be valid for the purposes of divorce. Look at the Palimony cases. The New York Supreme Court validated a CLM of a couple who had lived together for 25 or some years, owned property in PA as H&W, had registered as H&W in hotels in other CLM jurisdictions.

IMRHO (the R stands for rarely), a couple living in unmarried cohabition is somewhere between ignorant and stupid to file MFJ. It's not Pandora's Box. It's more like a raising an infant tiger who may take a big bite of in a few years.

Rule #1: Never willfully and knowingly sign your name to a false statement.

Dick

Statutory marriage state: Fraud..

Common-law marriage state: The preparer is correct. Once you choose to hold yourselves out as a couple, you're married.

However, there is no common-law divorce (at least without the use of firearms!). ;-)

Ageeed.

There MUST be a clear present-tense agreement to create a common-law marriage. If the preparer asked each of them "Do you want to be married" and they both answered "Yes", then they have created a CLM. Without that agreement, there is no marriage according to the Tax Court.

However, as I pointed out in another post, signing an MFJ tax return may create a CLM for the purposes of divorce. Think about someone with $150,000 income who shacks up with someone with a $15,000 and then files MFJ for 3-5 years. The low income person could clean clock in divorce. court. If the high income person claims the CLM was only for tax purpose, he/she is admitting to tax fraud.

Dick

I'm a little puzzled by the "present-tense" part. What if they indicated their clear agreement a long time ago in front of someone else (not necessarily a tax preparer), and also met all of their state's other CLM requirements? Why wouldn't they be married in that case too?

As a tax preparer, I would *never* ask a client if they *want* to be married. Really, think about it... ;-)

I would ask them if they *are* married (as of Dec 31), and if they couldn't give me a straight answer, I would not be able to help them complete their tax return. (I might try to explain my very limited non-legal understanding of CLM, consisting mostly of the fact that my state does not recognize the creation of such in my state).

-Mark Bole

This makes me glad I live in a statutory marriage state. However, unfortunately, the state is California where (for the moment) we have same-sex marriages.

But if both members are working and each making a bit of money, then the marriage penalty kicks in and they pay more tax. The tax rates are higher, phaseout of itemized deductions, exemption, AMT exemption are higher, stock loss is same as for single, etc. The Bush tax cut eliminated the penalty for those at lower incomes. So surely the IRS would not object to MFJ for these people.

Present-tense means that once-upon-a-time they agree to live together as though they were married and proceeded to hold themselves out as such. This is opposed to deciding it is now covenient for us to be married.

Of course, you wouldn't. It's subourning perjury on a tax return.

Dick

True. However that element can often be inferred from the element of "holding out" as husband and wife. That is to say that if they tell people they are married (signing into a hotel as Mr. & Mrs. can be enough) the courts may conclude from that fact alone that there is an agreement to be married.

Stu

That's not the only requirement, but it is an important one.

Based on my research (of Texas law - this may vary by state) the rule is not quite that exacting. As long as both parties, at the same time, have the intent to be married at some point, when the other requirements are there (cohabiting and holding out) it's sufficient to create a common law marriage even if they don't specifically intend or even know that their actions actually cause them to be married.

Stu