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I got married in 2016. After I provide my & my spouse's $ data, will Turbotax recommend the best way for us to file? Joint, Separate, w/ a standard deduction or itemized?

 
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I got married in 2016. After I provide my & my spouse's $ data, will Turbotax recommend the best way for us to file? Joint, Separate, w/ a standard deduction or itemized?

If you were married at the end of 2016 your filing choices are married filing jointly or married filing separately.

Married Filing Jointly is usually better, even if one spouse had little or no income. When you file a joint return, you and your spouse will each receive the $4050 personal exemption, plus the married filing jointly standard deduction of $12,600 (add $1250 for each spouse over the age of 65).  You are eligible for more credits including education credits, earned income credit, child and dependent care credit, and a larger income limit to receive the child tax credit. 

If you choose to file married filing separately, both spouses have to file the same way—either you both itemize or you both use standard deduction. Your tax rate will be higher than on a joint return. Some of the special rules for filing separately include: you cannot get earned income credit, education credits, or deductions for student loan interest. A higher percent of your Social Security benefits may be taxable.  In many cases you will not be able to take the child and dependent care credit.  If you live in a community property state, you will be required to provide additional information regarding your spouse’s income.  If you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice.

As for filing an itemized return vs. taking standard deduction:

Your itemized deductions have to be more than your standard deduction before you will see a change in your tax owed or tax refund.  The deductions you enter do not necessarily count “dollar for dollar;” many of them are subject to meeting thresholds  (for example: only the amount of your medical deductions that are over 10% of your AGI or over 7.5% if you are 65 or older are “counted”) or are calculated by a percentage of what you entered. The software program uses all the IRS rules that apply to the expenses you enter, and it tells you if you have enough to use your itemized deductions or if using the standard deduction is more advantageous for you. Here are the Standard Deductions for 2016

Your standard deduction lowers your taxable income.  It is not a refund 

2016 Standard Deductions

Single    $6300  (65 or older + $1550)

Married Filing Separately   $6300  (65 or older +  $1250)

Married Filing Jointly           $12,600  (65 or older + $1250@)

Head of Household $9250  (65 or older + $1550)

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

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I got married in 2016. After I provide my & my spouse's $ data, will Turbotax recommend the best way for us to file? Joint, Separate, w/ a standard deduction or itemized?

If you were married at the end of 2016 your filing choices are married filing jointly or married filing separately.

Married Filing Jointly is usually better, even if one spouse had little or no income. When you file a joint return, you and your spouse will each receive the $4050 personal exemption, plus the married filing jointly standard deduction of $12,600 (add $1250 for each spouse over the age of 65).  You are eligible for more credits including education credits, earned income credit, child and dependent care credit, and a larger income limit to receive the child tax credit. 

If you choose to file married filing separately, both spouses have to file the same way—either you both itemize or you both use standard deduction. Your tax rate will be higher than on a joint return. Some of the special rules for filing separately include: you cannot get earned income credit, education credits, or deductions for student loan interest. A higher percent of your Social Security benefits may be taxable.  In many cases you will not be able to take the child and dependent care credit.  If you live in a community property state, you will be required to provide additional information regarding your spouse’s income.  If you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice.

As for filing an itemized return vs. taking standard deduction:

Your itemized deductions have to be more than your standard deduction before you will see a change in your tax owed or tax refund.  The deductions you enter do not necessarily count “dollar for dollar;” many of them are subject to meeting thresholds  (for example: only the amount of your medical deductions that are over 10% of your AGI or over 7.5% if you are 65 or older are “counted”) or are calculated by a percentage of what you entered. The software program uses all the IRS rules that apply to the expenses you enter, and it tells you if you have enough to use your itemized deductions or if using the standard deduction is more advantageous for you. Here are the Standard Deductions for 2016

Your standard deduction lowers your taxable income.  It is not a refund 

2016 Standard Deductions

Single    $6300  (65 or older + $1550)

Married Filing Separately   $6300  (65 or older +  $1250)

Married Filing Jointly           $12,600  (65 or older + $1250@)

Head of Household $9250  (65 or older + $1550)

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

I got married in 2016. After I provide my & my spouse's $ data, will Turbotax recommend the best way for us to file? Joint, Separate, w/ a standard deduction or itemized?

If you enter your itemized deductions, once you have finished with deductions, Turbotax will tell you whether the standard deduction or itemized deductions give you more tax benefit, and it will let you choose. Turbotax will not advise you on MFJ vs MFS because that is a very complex matter. Each year you can choose to file as Married Filing Separately. However, that may not provide the benefit that you expect, and you will almost always end up paying more in tax than if you file jointly. The Married Filing Separately filing status is very different than the Single filing status. There are a number of severe restrictions on deductions and credits, and on the amount of IRA contributions that you can deduct, especially if you live together with your spouse. You can not take the EIC, You can not take the credit for Child and Dependent Care, in most cases, You can not take the Education credits/deductions, and there are many other restrictions. If either of you receive Social Security benefits and you live with your spouse, more of the SS benefit will be taxable, and the person receiving it will have to include the SS benefit in their gross income when determining whether they have to file. If one of you itemizes deductions, the other must also itemize even if they have nothing to itemize. Before you decide, you should carefully read the restrictions that go with MFS in IRS Pub. 501, at this link: http://www.irs.gov/pub/irs-pdf/p501.pdf You should carefully read the limits on IRA deductions in IRS Pub. 590-A at this link: http://www.irs.gov/pub/irs-pdf/p590a.pdf In addition, if you live in a Community Property state, there are special rules you must follow for reporting income and expense. For further information on that, see IRS Pub. 555, at this link: http://www.irs.gov/pub/irs-pdf/p555.pdf and/or the Turbotax FAQ at this link: https://ttlc.intuit.com/questions/1901162-married-filing-separately-in-community-property-states

I got married in 2016. After I provide my & my spouse's $ data, will Turbotax recommend the best way for us to file? Joint, Separate, w/ a standard deduction or itemized?

If you are using the Desktop installed program you can do unlimited returns so you can test.  Make up 3 returns, 1 for Joint and 1 each for separate.  Also there is a What-If worksheet you can use to compare things.  

Go to Forms Mode, click Forms in the upper right or on the left for Mac. Then click Open Forms box in the top of the column on the left. Open the US listing of forms and towards the bottom find the What-if worksheet. It's right under Estimated Taxes.  

 Or try…Go into Forms View. Once there, at the top of the left column, click on the icon for "Open Form". A popup window will appear. In the text line, type the word "what" without quotes. You should see "what-if worksheet" appear as a selection choice. Double-click it to launch the form.


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