@Samson14 wrote:
Can two married people file their taxes separately to keep their tax bracket lower on the higher income to enable a better refund.
If you are legally married, you have the option of filing a joint return or separate returns as married filing separate. If you file married filing separately (MFS) then each spouse files a return with only their own income, deductions and credits. If you share a child or children, each child can only be claimed as a dependent on one of the separate returns, not both.
For the reasons give by the other expert, filing separately almost always results in higher taxes. However, my wife and I did find several years ago, that by filing separately, we paid about $500 more on our federal returns but got back $1000 more from the state, because the state tax brackets were calculated differently. The only way to know for sure is to test both options.
There are some reasons you might want to file separately even if you know it will cost you.
1. One spouse owes a federal tax debt or other federal debt. The debt will be collected from any joint refund. Filing separately allows the other spouse to keep "their share" of the refund. You can also file jointly and include an "injured spouse" form, but this form is evaluated by the IRS and can take a long time. Filing separately means you get what you claimed, whether it is more or less than you might have gotten otherwise.
2. You might also file separately if one spouse is working under the table or is otherwise cheating the IRS. If you sign a joint return, you are equally liable for all statements and tax, and if one spouse is cheating on their taxes, the IRS can come after both spouses if you signed a joint return. Filing separate returns means each spouse is solely responsible for any errors, omissions or fraud.
