Tax question

[telecom_goddess]

Is our tax expert still around? I have a tax related question, this is in regards to future filings not this year. So I've filed head of household and then just single filing for many years. My dependents are all gone now, and I am planning on getting married in July. When it comes to filing for next year, is it more advantages to have us file jointly, or separately? I filed jointly like 1 or 2 years back in the 1980s so I don't remember.

Thanks

[csquared]

Karl is still around. We'll see if he agrees with my answer.

Typically, filing jointly will give you a couple dollar advantage. The tax brackets are well thought out. And to me, it is easier to go through the paper work once.

Situations vary. They only way to find out for sure, is to run the numbers. With the new higher standard deduction, you will probably find it less likely to get something out of filing separately. Stacking all the deductions on one individual is how you usually game it.

Then of course, there is this.

[EricKei]

Drop taxguykarl a private message and ask him to respond in-thread when he can

[taxguykarl]

Yes, I'm still here. I've been busy with a perfect storm of an extended tax season, neglected yard work, MIL health issues and studying for my EA tests.

First of all, TG, congratulations on your upcoming marriage. If you decide to go by the name of the future Mr. telecom_goddess (or vice-versa), that will have to be reported to Social Security. Apply as soon as possible after you have the marriage document. Just like the cards for kids, the Admin refuses to guarantee that the application will be processed by April 15th if you apply January through March.

Now for your question: In my 20 years of doing taxes, couples I've seen who come out ahead filing separately (MFS) can be counted on one hand...and all but one, in fact, owed less. Needless to say, the tax code has changed considerably since the '80's (the marriage penalty, a quirk in the tax code where a married couple could expect to pay more federal taxes than two singles living together).

csquared is correct that the brackets are more generous for filing jointly. Also certain credits like earned income and lifetime learning are not available for MFS. There is another pitfall: for MFS, both spouses must either itemize or take the standard deduction--one itemizing while the other takes the standard deduction is no longer allowed. Both must itemize even if one spouse has $0.00 in itemized deductions.

If one spouse has baggage like past-due student loans or child support innocent spouse relief is an option (that is the most common reason for couples to ask about filing sepatately).

Then of course, there is this.

What a coincidence. I had an exchange like that with a couple in March. I played a similar game of 'what if' for almost an hour. Damn glad it was a slow day.

[telecom_goddess]

Ok thanks....I just wanted to know the best way to go moving forward after soooooo many years of filing singly.

[taxguykarl]

I just wanted to know the best way to go moving forward after soooooo many years of filing singly.

Quite welcome. As every situation is unique, use a software (or lots of blank 1040's, if you're good at math or really patient) and play 'what if'. FWIW, my money is on filing jointly.
If you live in a state without income tax or bought a new car or other big ticket item, claiming sales tax can easily be the better option for you.

[EricKei]

Thanks for chiming in, Karl Your input is always appreciated!

[Kit-Ginevra]

That's another one crossed off my list of free and available ladies to pursue then