Filling out MFS Form 8958 with regards to Prenup?
Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
Announcements
TurboTax has you covered during Covid. Get the latest stimulus info here.
cancel
Showing results for 
Search instead for 
Did you mean: 
MxC86
Returning Member

Filling out MFS Form 8958 with regards to Prenup?

Hello! Just married not long ago and spouse and I chose to file MFS. We have a prenup which separates all our occupational income and the income from rent. I'm in California (community property state). 

 

Should we still show our incomes split 50-50 on our form 8958's? Or show it as 100% our own and keep Total column C blank as none allocated to spouse? Or, do we simply check the "No" box where it asks if  community property amounts are reported on the return? (Since we have none.) 

 

Unfortunately, I wasn't able to find this information on my own. I appreciate anyone's help! Thanks!

 

3 Replies
pk
Level 12
Level 12

Filling out MFS Form 8958 with regards to Prenup?

@MxC86 , this is what I find from IRS Pub 555--->

 

Community Property Laws Disregarded

The following discussions are situations where special rules apply to community property and community income for spouses. These rules don't apply to registered domestic partners.

Certain community income not treated as community income by one spouse.

Community property laws may not apply to an item of community income that you received but didn't treat as community income. You are responsible for reporting all of that income item if:

  1. You treat the item as if only you are entitled to the income, and

  2. You don't notify your spouse of the nature and amount of the income by the due date for filing the return (including extensions).

 

Relief from liability for tax attributable to an item of community income.

You aren't responsible for the tax relating to an omitted item of community income if all the following conditions are met.

  1. You didn't file a joint return for the tax year.

  2. You didn't include the item of community income in gross income.

  3. The item of community income you didn't include in your gross income is one of the following.

    1. Wages, salaries, and other compensation your spouse (or former spouse) received for services he or she performed as an employee.

    2. Income your spouse (or former spouse) derived from a trade or business he or she operated as a sole proprietor.

    3. Your spouse's (or former spouse's) distributive share of partnership income.

    4. Income from your spouse's (or former spouse's) separate property (other than income described in (a), (b), or (c)). Use the appropriate community property law to determine what is separate property.

    5. Any other income that belongs to your spouse (or former spouse) under community property law.

  4. You establish that you didn't know of, and had no reason to know of, that community income.

  5. Under all facts and circumstances, it wouldn't be fair to include the item of community income in your gross income.

 

This should provide ample guidance in your situation, while the Pre-nup protects  you from challenge by spouse.

Does that make sense ?  Is there more I can do for you ? 

MxC86
Returning Member

Filling out MFS Form 8958 with regards to Prenup?

Hi @pk ! You're great! I greatly appreciate your post and guidance!

 

We individually treat our income as our own, but I didn't quite understand the part about "and you don't notify the spouse the nature and amount of the income by the due date for filing the return (including extensions)."

 

If this "and" were an "or" I'd have a clearer understanding, but it sounds like one would need to split 50-50 unless s/he doesn't notify the spouse of the income by the filing due date? We both know about one another's incomes and agree to both of our incomes are not community property, though California is a community property state. As such, since I can't say I didn't notify my spouse of the income by the return due date, community property laws do apply?

 

Maybe there isn't a clear-cut answer like I thought there would be. I'm leaning towards the keeping Total column C blank and show Total column B as 100% our own unless recommended this is not correct. Would doing this raise an automatic red flag?

 

Thank you for being so helpful, but I think I'm a still a bit lost in my confusion.

pk
Level 12
Level 12

Filling out MFS Form 8958 with regards to Prenup?

@MxC86 , not being a lawyer I seek a reasonable  and simple path. And to me  by  means of a recognized/registered legal agreement  you have  decided to put certain items  outside the  "community property/asset " and thus  if your incomes are outside the marital / community holdings then  you should be in the clear to disregard the other spousal income.  IMHO

A consult with the lawyer whom prepared the  Pre-Nup Agreement may  be  worthwhile, so there are no misunderstandings.

Dynamic AdsDynamic Ads
v
Privacy Settings