I am Working in Oregon and spouse and I Live in Washington (Joint vs Separate tax returns)

[wewillsee]

Situation: Spouse and I live in Washington state. She works in WA. I work in Oregon. We file federal taxes as Married filing jointly. I will have to file a Oregon non-resident 40N state tax this year and I am wondering if I need to file the same as Married Filing Jointly, Married Filing Separate, or Single.

The premise of the question was to only share my W2 income with Oregon since that has oregon sources and not include everything else in the Federal joint return for my spouse.

[JohnB5677]

What you want to happen is what will happen.

• You will file a FEDERAL Married Filing Jointly return.  
  • It will contain both of your incomes.
• You will file a Washington Married Filing Jointly return.  
  • It will contain both of your incomes.
  • You will get a credit for taxes paid in Oregon.
• You will file an Oregon Married filing Jointly return. 
  • It will only include your W-2.

[Critter-3]

COMPLETE in this order : 

• 1) You will file a FEDERAL Married Filing Jointly return.  
  • It will contain both of your incomes.
• 2) You will file a NON RESIDENT  Oregon Married filing Jointly return. 
  • It will only include your W-2 ... ALLOCATE only your income to OR
• 3)  WASHINGTON state has no income tax so no filing needed. 

[wewillsee]

Thanks.

Can I do it all in Turbotax online?

When I tried 1) Married filing jointly federal - it had both of our incomes - which is good.

Subsequently when I clicked on State and completed Married filing jointly - for some reason it showed my non-oregon income in it as well.

Do I need to create a Mock Married Filing Jointly with ONLY my W-2 for this to work?

[Critter-3 · Accepted solution]

If you follow the OR non resident interview it will show you all of the income reported and you have to allocate the OR portion to OR.  READ the screen carefully ....

[wewillsee]

Thank you - super helpful.

asking a slightly ambiguous question.

when filing the state return, I’d like to only expose my Oregon source income for the “federal” portion rather than the total income for my wife and I. Is that allowed? Basically I’d create a mock federal return married filing jointly but only include the Oregon w2 ignore any other income for the federal portion.

basically I don’t want to provide more information about non Oregon income unless I absolutely need to.

appreciate the help

[AmyC]

No. The federal government and states share information. You would be wasting your time creating a mock version and could be causing more trouble. Just follow the instructions of  @Critter-3 above.