If my wife and I split all income from our joint accounts while filing MFS in a NON-community property state, how do we explain this to the IRS? Can we use Form 8958?

[rh0o0]

We live in North Carolina and are splitting the income in all our joint accounts (50/50) and filing MFS because my wife's penalty for getting excess ACA subsidy is much less than reimbursing the entire subsidy. This reduces our total tax bill considerably. Can we still efile if we use form 8958?

[Anita01 · Accepted solution]

No,the 8958 is for taxpayers in  community property states.  Couples file married separate and split their joint accounts all the time in non-community property states.  You don't need to provide any specific explanation to the IRS.