itemized and standard deductions - married filing seperately

[gatorbrett1]

Hi, I am doing "sample" tax returns on turbotax. I itemized deductions due to excessive medical expenses, and my federal deductions for me will end up being $24000, which will save me much on my return.

Where I need help is with my wife. She has very minimal deductions, which do not exceed the medical threshold amount. I thought she could not receive the standard deduction of 12550, yet when I'm doing the sample tax return for her, it shows 12550 for "federal deductions we found for you". I thought under this category it would be 0 since we were itemizing.

Someone please help - is the 12550 amount being shown correct for my wife even though she has very minimal deductions?

Thank you!

[macuser_22]

The tax law does not allow that.  If one spouse itemizes then both must itemize  even if that spouse has nothing to itemize. 

If you file MFS (Married Filing Separately) keep in mind that there are several limitations to MFS.  Married filing Jointly is usually the better way to file.
 
A few of those limitations are: (see IRS Pub 17 for the full list

https://www.irs.gov/pub/irs-pdf/p17.pdf

1. Your tax rate generally is higher than on a joint return.
2. Your exemption amount for figuring the alternative minimum tax is half that allowed on a joint return.
3. You cannot take the credit for child and dependent care expenses in most cases, and the amount you can exclude from income under an employer's dependent care assistance you are legally separated or living apart from your spouse, you may be able to file a separate return and still take the credit. For more information about these expenses, the credit, and the exclusion, see chapter 32.
4. You cannot take the earned income credit.
5. You cannot take the exclusion or credit for adoption expenses in most cases.
6. You cannot take the education credits (the American opportunity credit and lifetime learning credit) or the deduction for student loan interest.
7. You cannot exclude any interest income from qualified U.S. savings bonds you used for higher education expenses.
8. If you lived with your spouse at any time during the tax year:
a. You cannot claim the credit for the elderly or the disabled, and
b. You must include in income a greater percentage (up to 85%) of any social security or equivalent railroad retirement benefits you received.
9. The following credits and deductions are reduced at income levels half those for a joint return:
a. The child tax credit,
b. The retirement savings contributions credit,
10. Your capital loss deduction limit is $1,500 (instead of $3,000 on a joint return).
11. If your spouse itemizes deductions, you cannot claim the standard deduction. If you can claim the standard deduction, your basic standard deduction is half the amount allowed on a joint return.
12. You cannot contribute to an IRA if your MAGI if more then $10,000 and you lived with yiru spouse at anytime during the year.
13. If you live in a community property state you must allocate community income between both spouses..
-
- Community property states.   If you live in Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin and file separately, your income may be considered separate income or community income for income tax purposes. See Publication 555. http://www.irs.gov/publications/p555/index.html

 
See this TurboTax article for help with this.
https://ttlc.intuit.com/questions/1894449-married-filing-jointly-vs-married-filing-separately

https://ttlc.intuit.com/questions/1901162-married-filing-separately-in-community-property-states

[xmasbaby0]

If you are filing married filing separately, you both have to itemize or you both have to use standard deduction.   it cannot be one of each.   So if you are itemizing and using up all the itemized deductions yourself, your spouse will not even get her standard deduction amount.  She might have to pay tax on ALL of her own income.

If you are seeing a standard deduction for your spouse, you have done something incorrectly.   When you chose to file married filing separately, if you said that you would itemize on your return, it should "lock in" itemizing for your spouse too.   You will have to go back and see what you missed on those screens when you chose MFS for each of your returns.

Click edit by your names in My Info on each return and go through slowly and carefully.

[MinhT1]

When you file as Married filing separately. both spouses have to use the same type of deduction: either standard for both or itemized for both.

If you use itemized dedductions, then your spouse has to also use itemized deductions even if they are smaller to the standard deduction. She cannot use the standard deduction of $12,550.

[gatorbrett1]

Thank you much! I went to my name and had not checked off that either my wife or I get itemized deductions. The standard deduction was removed and true number reflected.