My husband and I are filing taxes separately this year for a few reasons, including qualifying for financially advantageous student loan repayment terms for his loans. Due to this, a number of complications have arisen. All solvable, but this latest one has stumped me a bit. My question revolves around community property income adjustments.
We lived in AZ for 6 months (a community property state) from Jan-June 30 and in UT (not a community property state). I was the sole income while living in AZ and made $63,008 while domiciled there. TurboTax is asking me about community property addition or subtraction adjustments. My interpretation is this but I'm not confident about it: Brennan should be reporting half my income for the Jan-June time period as a community property addition adjustment ($31,504) on his return and I should be reporting the other half as a community property subtraction adjustment ($31,504) on my return. We both had W-2 incomes once we moved to Utah.
To further complicate, I was a 1099 worker while earning that $63,008 so I made 2 estimated tax payments (Q1, Q2) each to the federal and AZ governments. So then I need to adjust withholdings as well, right?
I think things are clean cut once we made the move to Utah because we both are W-2 workers with normal employer withholdings, and UT is a non community property state.
Thank you SO MUCH for any advice you can offer.
