I separated from my husband in March 2018 and set up my own accounts. How do we handle interest on joint accounts? Do I have to pro-rate the interest for our time together? How do we handle charitable donations prior to separation? Thanks in advance!
I wish there was a simple answer to your question. Community Property laws can complicate the matter. One rule to keep in mind is that when filing as Married Filing Separately, if one of you plans to itemize deductions, the other person must itemize as well. Otherwise, you’ll both have to use the standard deduction, in which case the issue of allocating deductions goes away.
For more information about Married filing separately in community property states, see the following link: Filing MFS in Community Property States
One final thing you may want to consider is that, if you have a child and you and your spouse did not live together during the last six months of the year, you may qualify to file as Head of Household. To qualify for Head of Household status, you must be either unmarried or considered unmarried on the last day of the year. You are considered unmarried on the last day of the tax year if you meet all the following tests.
You file a separate return. A separate return includes a return claiming married filing separately, single, or head of household filing status.
You paid more than half the cost of keeping up your home for the tax year.
Your spouse didn't live in your home during the last 6 months of the tax year. Your spouse is considered to live in your home even if he or she is temporarily absent due to special circumstances.
Your home was the main home of your child, stepchild, or foster child for more than half the year.
You must be able to claim an exemption for the child. However, you meet this test if you can't claim the exemption only because the noncustodial parent can claim the child using the rules.
Do you have a formal separation agreement and do you live in a community property state?
We have some temporary orders in place re: child support, alimony, but the other agreements about accounts are not finalized. However, I do live in a community property state (CA). In going through the TurboTax interview, things are coming up as well about the HSA, Tax Refund. I'm just wondering in general who records those or do they get pro-rated based on time together.
I wish there was a simple answer to your question. Community Property laws can complicate the matter. One rule to keep in mind is that when filing as Married Filing Separately, if one of you plans to itemize deductions, the other person must itemize as well. Otherwise, you’ll both have to use the standard deduction, in which case the issue of allocating deductions goes away.
For more information about Married filing separately in community property states, see the following link: Filing MFS in Community Property States
One final thing you may want to consider is that, if you have a child and you and your spouse did not live together during the last six months of the year, you may qualify to file as Head of Household. To qualify for Head of Household status, you must be either unmarried or considered unmarried on the last day of the year. You are considered unmarried on the last day of the tax year if you meet all the following tests.
You file a separate return. A separate return includes a return claiming married filing separately, single, or head of household filing status.
You paid more than half the cost of keeping up your home for the tax year.
Your spouse didn't live in your home during the last 6 months of the tax year. Your spouse is considered to live in your home even if he or she is temporarily absent due to special circumstances.
Your home was the main home of your child, stepchild, or foster child for more than half the year.
You must be able to claim an exemption for the child. However, you meet this test if you can't claim the exemption only because the noncustodial parent can claim the child using the rules.