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Rule for Married Filing Jointly?
Posted on 9/5/18 at 6:16 pm
Posted on 9/5/18 at 6:16 pm
I was married in May 2018. Can I file married filing jointly? Any benefits to doing so over each of us filing single? Both are w-2 employees and we also just bought a house so we’ll have some mortgage interest deduction.
5
Posted on 9/5/18 at 6:27 pm to boosiebadazz
Yes you can file married filing jointly.
You may or may not benefit one or the other.
Consult a CPA or run the numbers and see what they look like. Probably beneficial to file jointly.
You may or may not benefit one or the other.
Consult a CPA or run the numbers and see what they look like. Probably beneficial to file jointly.
Posted on 9/5/18 at 6:29 pm to southernelite
What’s one area where married jointly offers better benefit than separately?
Just trying to get an overview. I’ll meet with the CPA later this year
Just trying to get an overview. I’ll meet with the CPA later this year
Posted on 9/5/18 at 7:15 pm to boosiebadazz
Depending on your separate incomes and what they combine to, you may land in a more advantageous tax bracket and the phaseouts for certain credits and deductions are higher.
Posted on 9/5/18 at 7:35 pm to boosiebadazz
You can file jointly. 99.9% chance filing that way will be advantageous to you. Very, very few scenarios make it a better option to file separately. I've never really seen one in real life.
Posted on 9/5/18 at 8:14 pm to southernelite
quote:
Depending on your separate incomes and what they combine to, you may land in a more advantageous tax bracket and the phaseouts for certain credits and deductions are higher.
The Trump Tax Act fixed most of this, finally.
Just remember, in a community property state you still have to split the income and withholding 50/50 on your federal taxes which requires some adjustments.
This will lead the IRS to reject one of your returns, since one of you will show trying to claim more taxes paid than your W-2 (funny how their automated system didn't stop the return that didn't claim all their taxes paid right
). You then have to battle the IRS to read Publication 555 but you'll eventually win 4 months or so later.This post was edited on 9/5/18 at 8:24 pm
Posted on 9/5/18 at 8:14 pm to Mingo Was His NameO
quote:
I've never really seen one in real life.
Student loan repayment is possibly one.
Posted on 9/5/18 at 8:20 pm to Teddy Ruxpin
quote:
Student loan repayment is possibly one.
Yeah that and big time income inequity, but like I've said they are so rare I've never seen one
Posted on 9/5/18 at 8:20 pm to boosiebadazz
You will have to file jointly if you want either of you want to contribute to a Roth
This post was edited on 9/5/18 at 8:50 pm
Posted on 9/5/18 at 8:24 pm to gamatt53
quote:
You will have to file jointly if you want either of you to do a contribute to a Roth
Not true. You can still contribute to a traditional IRA and then backdoor into the Roth
Posted on 9/5/18 at 8:26 pm to Teddy Ruxpin
No student loan repayment. One income is $40k to $50k, other one is $110k to $120k. Would either of those fall into the advantageous filing single due to the brackets?
Posted on 9/5/18 at 8:30 pm to boosiebadazz
As mentioned above, the Trump Tax Act fixed the income tax brackets. If you look now, the married filing jointly tax brackets are double single filers. This wasn't the case before and really should have been fixed years ago.
So I imagine if your only concern is based on income only, then no, there is no benefit.
If you have some other situation you need to research that situation or tell the board what it is so they can help.
So I imagine if your only concern is based on income only, then no, there is no benefit.
If you have some other situation you need to research that situation or tell the board what it is so they can help.
Posted on 9/5/18 at 8:30 pm to boosiebadazz
quote:
No student loan repayment. One income is $40k to $50k, other one is $110k to $120k. Would either of those fall into the advantageous filing single due to the brackets?
Highly highly doubtful. Only 4% of married tax returns last year were separate. At those income levels unless you have a highly unusual return it will be joint.
Ie large loan repayments, out of pocket medical expenses, something of that nature.
This post was edited on 9/5/18 at 8:32 pm
Posted on 9/5/18 at 8:33 pm to Teddy Ruxpin
quote:
If you have some other situation you need to research that situation or tell the board what it is so they can help.
Ours is pretty straightforward. Both have IRAs through work, she has an HSA, w-2 wage earners, minimal stock market gains/losses (>$500), just bought a house, no student loans. The OP is more towards telling me what to look for if there is something there... Looks like there really isn't though. No real advantage to filing single.
Posted on 9/5/18 at 8:35 pm to boosiebadazz
quote:
Ours is pretty straightforward. Both have IRAs through work, she has an HSA, w-2 wage earners, minimal stock market gains/losses (>$500), just bought a house, no student loans. The OP is more towards telling me what to look for if there is something there... Looks like there really isn't though. No real advantage to filing single.
You'll file jointly and you really don't even need a CPA. TurboTax will walk exactly through what to do.
Posted on 9/5/18 at 8:35 pm to boosiebadazz
Ya, you'd probably intuitively would know it when you see it if you had something.
Those kind of things jump out at people who have to deal with them.
Those kind of things jump out at people who have to deal with them.
This post was edited on 9/5/18 at 8:36 pm
Posted on 9/5/18 at 9:30 pm to boosiebadazz
Your choices are married filing jointly or married filing separate, talk to your CPA, there are disadvantages to filing separate that may apply to your situation
Posted on 9/5/18 at 9:34 pm to boosiebadazz
I want to clarify something you mentioned, and it's something that a lot of people get confused about.
If you are married as of Dec 31, the general rule is you have one of two options:
Married Filing Joint
Married Filing Seperate
Filing "Single" is NOT one of the two options
(The exception is when you are legally seperated for all 365 days of the year, and don't "share" any income... too complex for this post).
In a Community Prop state like LA, unless you have a seperate prop agreement, all income and deductions from both spouses are combined, then split 50/50. The Married Filing Seperate return then just becomes two pretty identical returns.
At that point, pretty much the only benefit is a potential reduction in student loan repayments if you choose an income-based plan. However, if you file MFS, you are unable to deduct any student loan interest. Depending on your income, that may or may not be something you can claim filing jointly, either.
And as was said by another poster... the recent tax act pushed the "marriage penalty" much, much higher into the tax brackets.
The only other reason to consider Married Filing Seperate is if one spouse has prior tax problems. Sometimes it's easier to file MFS than to file as an innocent spouse.
If you are married as of Dec 31, the general rule is you have one of two options:
Married Filing Joint
Married Filing Seperate
Filing "Single" is NOT one of the two options
(The exception is when you are legally seperated for all 365 days of the year, and don't "share" any income... too complex for this post).
In a Community Prop state like LA, unless you have a seperate prop agreement, all income and deductions from both spouses are combined, then split 50/50. The Married Filing Seperate return then just becomes two pretty identical returns.
At that point, pretty much the only benefit is a potential reduction in student loan repayments if you choose an income-based plan. However, if you file MFS, you are unable to deduct any student loan interest. Depending on your income, that may or may not be something you can claim filing jointly, either.
And as was said by another poster... the recent tax act pushed the "marriage penalty" much, much higher into the tax brackets.
The only other reason to consider Married Filing Seperate is if one spouse has prior tax problems. Sometimes it's easier to file MFS than to file as an innocent spouse.
Posted on 9/5/18 at 9:48 pm to LSUFanHouston
I was hoping you’d see this and respond. Thanks for the response. None of those scenarios apply to us, so we’ll most likely do married filing jointly.
Posted on 9/6/18 at 6:58 am to LSUFanHouston
Yeah I really only see MFS when one spouse has serious tax issues
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