What to do about taxes with student loans and newly married? Details below

Submitted by agjjnf222 t3_10p4r6x in personalfinance

Hey everyone,

I recently got married in September of 2022 and my wife are figuring out what to do about taxes. We do have a tax guy but just curious what your thoughts are:

I roughly make 95k + productivity bonus per year which is usually 20-30k paid quarterly( 6-7k per quarter). It fluctuates but my take home pay every two weeks is 95k gross.

I have 128k from grad school in debt with a minimum payment of 1600 at 2.8% private (refinanced in 2020). I am happy with this and it is manageable from an income standpoint.

My wife makes roughly 60k gross with 48k in private loans. Her dad was the co-signer and has been paying these up until now. $600 min payment with variable rates (working on getting refinanced) but we are taking these over. Again, this is manageable.

My wife also has 27k in defaulted loans that we didn’t know about (I know I know) and I am enrolling her in the fresh start program which brings them out of default and back into normal federal loans. We have until June when the pause is supposed to end to figure out payment plan. I’m not too worried about it but just some questions.

  1. Would it be more beneficial to file separate or joint in terms of all things considered above? Or does it all depend on other tax liabilities?

  2. If we file joint then I am just afraid that her 27k new payment will be based on both incomes and a lot higher, so is that just something my tax guy can help me with?

Thank you for the help.

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Comments

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meamemg t1_j6ia80x wrote

If you file separately you will likely pay more in taxes. Your tax guy can tell you how much more. It would then be up to you to decide if it is worth it to get lower student loan repayments.

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agjjnf222 OP t1_j6id0jj wrote

Yea that’s what I’m thinking. Because do income driven payment plans change each year? For example if we File joint next year then her payment would again change ?

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meamemg t1_j6id3sy wrote

Probably. You'd need to look into the terms of the particular program you are signing up for.

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shadow_chance t1_j6jas6j wrote

Nothing about this suggests filing separately would be wise.

> If we file joint then I am just afraid that her 27k new payment will be based on both incomes and a lot higher, so is that just something my tax guy can help me with?

She has a 60K income alone, I haven't done the simulation calculator lately but I doubt income based really helps her whether you file joint or separately.

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agjjnf222 OP t1_j6jb11b wrote

Okay I guess my thought was would the minimum she may get for her loans based on individual income be better than whatever extra we may pay in taxes. I just wasn’t aure

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