My wife and I were planning on filing jointly for the second year in a row. My wife insisted on doing the figures this year again. In 2006, I paid out more taxes than any other time in my life (when i was single I always received at least $500 from the tax return). But my wife (not to blame her in any way) found out that because her employer did not take out enough federal taxes we owe about $800! What? I am pretty devastated. SHOULD I LOOK INTO FILINING SEPARATE? IS THERE ANY POSSIBILITY WE COULD COME OUT BETTER INDIVIDUALLY? WE MADE APPROXIMTALEY (COMBINED) $65, 000. PLEASE, SERIOUS, INFORMED FEEDBACK ONLY. ALSO, I DO NOT WANT TO SPEND A LOT ON FINDING OUT THAT WE STILL OWE A LOT. THANKS EVERYONE.
2007-02-25 14:48:24 · 5 answers · asked by James R 1 in Business & Finance ➔ Taxes ➔ United States
You can certainly run the numbers both ways, filing separate and then jointly. However, I think you'll find that if you file separate, because you will be taxed higher at a lower income for single, that all of a sudden you will owe taxes and your wife will get a refund.
This doesn't take a lot of money to find out. If you use tax software, it will cost you nothing extra to run the calculations both ways.
In most cases, couples are better off filing jointly instead of separately.
2007-02-25 14:59:57 · answer #1 · answered by Uncle Pennybags 7 · 0⤊ 0⤋
No, you will almost always pay MORE in taxes if you file separate returns.
Your situation isn't uncommon at all with married couples. It's especially true if one spouse makes significantly more than the other one does.
Married couples MUST fill out their Forms W4 http://www.irs.gov/pub/irs-pdf/p524.pdf together and complete the Two-Earners/Multiple Jobs Worksheet on page 2 to ensure that sufficient tax is withheld from both paychecks.
If you have an $800 tax debt, you need to have an additional $16.00 withheld per week between you. If you are both paid bi-weekly, you could each opt to have an additional $16.00 withheld from your bi-weekly pay to cover that liability. You can split this up any way you wish, but the additional withholdings are required, either by reducing your withholding allowances or designating an additional withholding amount from your paychecks.
2007-02-25 21:35:55 · answer #2 · answered by Bostonian In MO 7 · 2⤊ 0⤋
Try Turbo Tax. I've filed using that for the past 5 years and I love it. Its really easy to use. You can even download it. Around $50.
2007-02-25 15:01:03 · answer #3 · answered by Stingo 34 3 · 0⤊ 1⤋
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2007-02-25 16:11:27 · answer #4 · answered by ellen h 2 · 0⤊ 1⤋
most likely you'll be better off filing together, unless yous and your wife's income are very different (ex. you made 55,000 and she made 10,000)
if you get your taxes done at H&R block they will actually compare filing options for you (MFJ vs. MFS) for no additional fee; so that's something you might want to consider
2007-02-25 14:53:55 · answer #5 · answered by NJchick 3 · 0⤊ 1⤋