My wife and are were married in June and we're debating whether to claim married jointly or claimed married separately. I'm in a 28% tax bracket, she's in 25%. We own a house and have a son. What should we do? And more importantly, why should we do that?
2007-11-04 11:23:11 · 7 answers · asked by marko 1 in Business & Finance ➔ Taxes ➔ United States
Unless there is a pressing reason for filing separately (MFS) then filing jointly (MFJ) does result in lower overall taxation in *most* cases.
Reasons for filing MFS could include one spouse owing spousal or child support, one spouse having old tax debt or just one spouse isn't trust worthy. I've met quite a few client who just did not want to mix finances with their spouse for any reason.
If you do file MFS, you lose quite a few deductions and credits including tuition and fees deduction, student loan interst deduction and eductions credits. Other credits and benefits phase out much sooner including traditional IRAs, Roth IRAs and the child tax credit.
I would try your taxes both ways. Many tax preparation firms can gather all of your information and do a comparison of the two methods of filing.
2007-11-04 12:11:29 · answer #1 · answered by BeckyBeq 3 · 0⤊ 0⤋
If you have income and your spouse does not have income or has a very little income, then it is better to file as Married Filing Jointly. If both of you have almost equal income, then it won't make much difference. Also may credits and deductions are not available if you file Married Filing Separately. So normally you should file as Married Filing Jointly, unless there is a compelling reason to file otherwise.
This is from IRS publication 17: Your Federal Income Tax. Tip. If you and your spouse each have income, you may want to figure your tax both on a joint return and on separate returns (using the filing status of married filing separately). Choose the method that gives the two of you the lower combined tax.
2007-11-04 19:27:27 · answer #2 · answered by MukatA 6 · 0⤊ 0⤋
Unless you have reason to believe that there are reasons that you should not file jointly, then you should file a joint return.
When you file MFS, if one spouse itemizes, the other must itemize as well. Also, you will lose the $1000 Child Tax Credit and other possible credits by filing separately.
2007-11-04 11:51:27 · answer #3 · answered by Steve 6 · 0⤊ 0⤋
If one of you has large unreimbursed employee business expenses or high medical bills, it's possible but by no means sure that filing separately would give you a lower tax bill. Otherwise, filing a joint return will give you a lower tax bill overall - maybe just a few dollars, maybe much more.
2007-11-04 14:31:34 · answer #4 · answered by Judy 7 · 0⤊ 0⤋
Usually a joint return means less total tax. But the sure way to know is to run the calculations out both ways.
2007-11-04 11:28:55 · answer #5 · answered by npk 7 · 1⤊ 0⤋
Usually joint works out to a bigger refund or less total tax paid. With the tax software like Turbo Tax it's easy to figure it out both ways.
2007-11-04 11:51:51 · answer #6 · answered by crazydave 7 · 0⤊ 0⤋
Jointly or you will not get the $1,000 child credit for your son.
2007-11-04 12:17:58 · answer #7 · answered by Anonymous · 0⤊ 1⤋