Three Reasons to File Separately While Married

There are certain circumstances in which filing separately can be beneficial to financial condition when while you are married. The Internal Revenue Service (IRS) considers a couple married when they legally marry under state law, live together, or are separated but with no signed divorce by the end of the current tax period.WeddingRing

Having Similar Incomes

It may be beneficial for couples with similar incomes to file separately when both sides earn approximately the same amount. When comparing the amount of tax capital due under both statutes, combining earnings will place the couple into a higher bracket. However, investments, dependents and other factors may affect whether filing separately is optimal even when incomes are approximate.

Using Deductions

Tax deductions will lower taxable income, but in order to be of use they must add up to more than two percent of the couple’s adjusted gross amount. Spouses with union dues, occupation searches, and tax preparation fees may find that their miscellaneous deductions will not qualify with the couple’s combined rate.

Protecting Yourself

If you don’t want to be liable for your partner’s tax bills, choosing to file separately will offer financial protection. The IRS won’t apply your spouse’s refund to your balance due. Separate returns can prevent the Internal Revenue Service from taking a spouses’ refund when your partner has fallen behind on certain types of payments.

Conclusion

Filing your taxes separately from your significant other can lead to many beneficial outcomes. Make sure to discuss the decision of your filing status with your partner before the next upcoming tax season.

Image credit: ilovebutter

About Shoreline CPA

Speak Your Mind

Tell us what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!

  • Huddleston Tax CPAs / Huddleston Tax CPAs – Shoreline, WA
    Certified Public Accountants Focused on Small Business
    18208 66th Avenue NE, Suite 102 Kenmore, WA 98028
    425-483-6600

    Huddleston Tax CPAs & accountants provide tax preparation, tax planning, business coaching,
    QuickBooks consulting, bookkeeping, payroll, offer in compromise debt relief, and business valuation services for small business.

    We serve: Federal Way, Des Moines, Kent, Auburn, and communities throughout WA and beyond. Call to meet John C. Huddleston, J.D., LL.M., CPA, Lance Hulbert, CPA, Grace Lee-Choi, CPA, Jennifer Zhou, CPA, or Jessica Chisholm, CPA. Member WSCPA.