Taking this in parts.
— staying married and using MFJ means we share financial responsibilities for each other
Yes, at least for income taxes.
— staying married but using married-filing-singly (MFS) means higher tax rates and fewer credits/deductions
Yes, in most cases.
— we can avoid both the MFJ and MFS concerns by simply filing as single persons
Yes, but you can only file as single if you are actually divorced.
— wrt total tax liability, two us each filing as single persons is not significantly different than using MFJ
This is usually true, but the only way to get an exact answer for your situation is for you to prepare test returns with your own facts. (**Also note this is more likely true if your incomes are similar. If your incomes are very different, the higher income spouse may pay more income tax after the divorce, while the lower income taxpayer may pay less.)
— if we divorce at any time during 2025, we must file as single persons for that tax year
Yes (unless you remarry, or qualify to file as head of household).
— the cap gains exclusion ends up the same: we each get a $250K exclusion
Yes. If you file a joint return you claim a $500K exclusion, if you are divorced and file single returns, or if you file MFS, you can claim $250K each.
— we can split the total cost basis equally along with the cost of sale
Yes.
— we each get a 1099-S as documentation for sale proceeds (and, I’d imagine, costs involved in the sale)
— on the 1099-S, the gross proceeds and sale costs are split equally
This should be discussed with the closing agent. A lazy agent might issue a single 1099-S to one spouse, especially if you are married at the time of the sale and plan to divorce later. Let the closing agent know what you want them to do. (Sometimes, for sale of a personal home, a 1099-S is not even required.)
