Are You Married?

MARRIED, BUT WANT TO FILE SEPARATE?

There are a number of reasons why the married- filing- separately status is not often
chosen by couples. The biggest reason is the loss of a number of major tax credits and
deductions that are available to those who file jointly, such as: Earned Income Tax Credit, child
tax credit, child and dependent care credit, adoption credit, and all kinds of education credit.
Furthermore, when it comes to married filing separately, both spouses must choose the same
method of recording deductions, even if one of them would be better off making under the
opposite method.

For example, if one spouse decides to itemize deductions, then the other spouse must do
so as well, even if their itemized deductions are less than the standard deduction. If one spouse
has itemized deductions of $20,000 and the other has only $2,500, the second spouse must claim
that $2,500 rather than the larger standard deduction. So filing separately is a good idea from a
tax savings standpoint only when one spouse’s deductions are large enough to make up for the
second spouse’s lost deduction amount. There are also many disadvantages of filing separately
that couples should evaluate prior to choosing this option. However, in which it is best for a
couple to file separately

 

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