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My spouse and I are filing separately. Since TX is a community property state, do we have to split our deductable medical expenses?

My wife and I have a lot of deductible medical expenses this year due to IVF. They were all paid out of my individual account before we were married. Do we have to split our medical deduction since TX is a community property state?
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My spouse and I are filing separately. Since TX is a community property state, do we have to split our deductable medical expenses?

I have to start this answer with “Why do you do want to file married separate in a community property state?” It is rare that this works out better. Unless you have an overwhelming reason to file married separate, I would file married joint and lump all your expenses together. But please read on...

Normally, expenses of the “community” are split 50-50 (see the text below), so that you might get to deduct half and your spouse might get to deduct half. But you must exceed the 10% (7.5% if you are over 65) of your adjusted gross income (“AGI”, line 37 on the 1040) in order to be able to deduct any medical expenses at all on Schedule A. Splitting your expenses in half just makes that more difficult. And remember that when filing married separate, that if one of you itemizes, both of you have to itemize.

The IRS says on this subject:

"Question: My spouse and I are filing separate returns. How do we split our itemized deductions? Answer:

If you and your spouse file separate returns and one of you itemizes deductions, the other spouse must also itemize, because in this case, the standard deduction amount is zero for the non-itemizing spouse.

  • You may claim itemized deductions on a separate return for certain expenses that you paid separately or jointly with your spouse.
  • When paid from separate funds, expenses are deductible only by the spouse who pays them.
    • For example, if otherwise deductible medical expenses are paid from an account owned by one of the spouses or in a community property state from an account that's the separate property of one of the spouses under the laws of that state, only that spouse may claim a deduction for the expenditure.
  • When expenses are paid from funds owned by both spouses, such as from a joint checking account or accounts considered community property under the laws of the state in which the spouses reside, you should generally split the deduction between you and your spouse.
    • For example, if amounts are paid from a joint checking account for interest on a residence both you and your spouse own, you would each deduct half of the mortgage interest paid on your separate returns.
    • However, if only one of you is eligible for a deduction for an expense (for example, real estate taxes on a property owned only by the eligible spouse), only the spouse who is eligible for the deduction is allowed to claim it, even if the expense is paid from joint funds. Each spouse must maintain records documenting who is considered to have paid the expense."

See the IRS FAQ on Deductions.

If the money in your separate account came from community income (i.e. money that either one of you made while married that can’t be considered separate under the law – and by default most income is community income unless proven otherwise – then I would consider that a common account, even if your spouse’s name is not on it.

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