Under what conditions is it in my interest to file my taxes married but separate instead of jointly?

Answer 1

if one of you can claim a large number of deductions, and the other cannot.

for example, if you have a mortgage in your name and lots of charitable deductions, etc, but your wife has none. you would file separately so you can claim all the deductions, and your wife would get the standard deduction for herself.

its pretty rare, but most tax places and software will run the numbers both ways for you.

Answer 2

About the only time when it's beneficial is when one spouse has a VERY low income and high medical expenses or high casualty losses. Medical expense deductions are subject to a limitation of 7.5% of AGI and casualty losses are subject to a 10% limitation. The lower AGI on a separate return maximizes the deductability of those items.

Contrary to what another poster said, if one spouse itemizes BOTH must itemize. So the spouse with the higher income also needs to have sufficient itemized deductions in their own right to make a separate return the best choice from a financial standpoint.

I some cases in Community Property states it can be beneficial to file separate returns if one spouse had little or no income and the other spouse has a farily high income. Each would file a return claiming one-half of the community income and would benefit from the lower tax rates for the lower income.

The other benefit of filing separate returns is that it isolates you from any claim that the government has against you based on your spouse's return. If you file a joint return that your spouse prepared and that return was fraudulent you would share joint liability for any taxes AND either or both of you could be prosecuted. Filing a separate return would keep you in the clear, the IRS could not go after you for your spouse's tax or prosecute you for your spouse's fraudulent return.

Answer 3

If you file married filing separate and itemize you deductions then your spouse would be required to itemize also or claim 0 as a standard deduction.

Most people file separately when they do not want to be legally responsible for the spouse's tax liability, If a spouse is self employed and doesn't make estimated payments, and the other spouse does not want their federal withholding going towards the others tax bill. One spouse could possibly be doing something illegal.

Answer 4

If you want to be responsible only for your own tax obligation,a difference in income with your spouse,deductions you can take,any credits you may get.
You can always use tax software and fill in the information to determine the best way to file. The cost of the software is tax deductable just as are the fees paid for tax preperation.
Some software gives you access to a web site so you can keep up with changes in tax laws during the year.
Filing seperately may result in a larger tax bill,that is why you should consider both options.

Answer 5

generaly, its not a good idea, but

When to File Separate Returns
You should always check out the potential advantage of using MFS maried filing separate) status whenever: 1) both you and your spouse have taxable income, and 2) at least one of you (preferably the person with the lower income) has significant itemized deductions that are limited by adjusted gross income (AGI).

Basically, AGI is the sum of all your income items (salary, capital gains, dividends, alimony received and so forth) reduced by nonitemized write-offs claimed on page one of Form 1040 (retirement account contributions, alimony paid, job-related moving expenses and so on). When you use MFS status, you must separately calculate your AGI and your spouse's AGI. As you are about to see, this can work to your advantage.

The three most common itemized write-offs that are limited by your AGI level are:

Medical expenses, which you can deduct only to the extent they exceed 7.5% of AGI.

Uninsured personal-casualty losses (like hurricane damage to your home), which you can deduct only to the extent they exceed 10% of AGI.

Miscellaneous itemized expenses (usually nonreimbursed employee business expenses and investment expenses), which you can only deduct to the extent they exceed 2% of AGI.

When you have these types of expenses, filing separately can lead to tax-saving results, because the AGI numbers on your separate returns will be lower. Therefore, deductions that are limited by your AGI may be considerably higher when you file separately.


The Dark Side of Filing Separately
Be warned: Using MFS status can disqualify you from a number of potentially valuable tax breaks. For example:

You can't claim the child and dependent-care tax credit.

You can't claim the deduction for college tuition and related expenses.

You can't claim the Hope Scholarship or Lifetime Learning tax credits for higher education expenses.

You can't claim the college loan interest write-off.

You can't deduct more than $1,500 of capital losses against ordinary income (compared to $3,000 if you file jointly).

You can't make a Roth IRA contribution if your AGI exceeds $10,000.

You can't convert a traditional IRA into a Roth account.

You must itemize deductions if your spouse itemizes (you can't claim the standard deduction).

This far from an exhaustive list, which is why you should always "run the numbers" with your tax software when evaluating whether MFS status might work for you.

Answer 6

What Kutekymme... is telling you is not correct. If a married couple files separately, if one itemizes then the other has to also, or just show 0 as a standard deduction.

Answer 7

There are very few times that there is a good financial reason to do this. Non-financial reasons might include if you are legally separated & not on good enough speaking terms to file jointly.

Answer 8

I used to do this because before I met my husband he did not file every year so he was racking up fines. We live in Washington state, and 2 years ago they told me I could no longer file separately because we live in a community property state, so until he gets all his fines paid we don't get our returns.

Answer 9

most places can do it both ways for you and tell you which is better