Filing status single vs Married Filing Seperate

[hashelmudt]

I am married but have been separated from my wife for years. We've not had a divorce. I made the error of beginning this tax return with 'single' filing status and TurboTax returned an error. I spoke with my wife and she said she filed Married Filed Separate. When I went in the change this in my return, my taxes  owed increased by almost 15%. I clearly know very little about taxes and I don't know why this would happen. It's frustrating to say the least. She has already filed or I might try to convince her to File Jointly (seems like that would be the $ saver) but it's too late for that. Is there anything else I can do?

[VolvoGirl · Accepted solution]

Yes MFS is the worst way to file.

It is usually better to file Joint. Joint has the lowest tax rates and the highest Standard Deduction.   And if you are in a Community Property state MFS gets tricky to figure out.  Here's some things to consider about filing separately……

In the first place you each have to file a separate return, so that's two returns.  And if you are using the Online version that means using 2 accounts and paying the fees twice.  

Many people think they come out better when filing Married Filing Separate but they are probably doing it wrong.  If one person itemizes deductions then the other one must itemize too, even if it's less than the standard deduction, even if it is ZERO!  

And there are several credits you can't take when filing separately, like the
EITC Earned Income Tax Credit
Child Care Credit
Educational Deductions and Credits

And contributions to IRA and ROTH IRA are limited when you file MFS.

Also if you file Married Filing Separately up to 85`% of your Social Security becomes taxable right away even with zero other income.

See …….
https://ttlc.intuit.com/questions/1894449-married-filing-jointly-vs-married-filing-separately

So you should try to file Joint if you both can agree.