My husband and I are retired with our income consisting of social security and dividends from investments. I currently live in California which is a community property state. My husband has lived the entire 2021 year in Hawaii which is not a community property state. We own homes in both states. Adding to the complexity of our tax situation, we installed solar panels on the house in Hawaii and want to take advantage of both the federal and Hawaii energy tax credits.
1) I'm assuming the state credit for the solar installation would go only on the Hawaii income tax forms. When I tried to set up a MFJ federal return, TurboTax said that it does not "support the situation for a married couple where each person lives in a separate home." So, does this mean we must file our taxes as married filing separately?
2) I understand there's no need to split the income if we file our federal taxes as MFJ. If we must file MFS because of the solar installation, can we simply assign the income for our various joint accounts solely to the person whose social security is on the various 1099s (we would have no problem with that) or must we split everything because one of the states is a community property state? If so, what would be the process?
Thanks in advance.
