How to Prepare for the Survivors Penalty

The year a spouse dies, the survivor can file taxes jointly with their deceased spouse, known as “married filing jointly,” unless they remarry before the end of the tax year. After that, many older survivors file taxes alone with the “single” filing status, which may include higher marginal tax rates, due to a smaller standard deduction and tax brackets, depending on their situation.

American women have a significantly higher life expectancy than men, according to data from the Centers for Disease Control and Prevention. In 2021, life expectancy at birth was 73.5 years for males compared to 79.3 years for females. As a result, married women are more likely than men to eventually face a “survivor’s penalty,” resulting in higher future taxes. Ed Jastrem, Chief Planning Officer at Heritage Financial, shared some ways to prepare with CNBC.

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