I want to claim ctc, i have a state debt that is about to be filed for garnishment My wife has a state debt that is 8000 and not yet. How should we file to get all it ?

[cheever.nathan87]

I have state debt that i got notice will be levied this month. And my wife has one for alot more that isnt as old and we dont know if should file seperate and I claim ctc since smaller debt or should she since hers isnt formally levied yet.  And can we file seperate with one claiming credits if we live together. Just dont want to lose 8k dollars from credits.

[Mike9241]

see this link since filing separately can result in the loss of some credits.

https://corvee.com/blog/child-and-dependent-tax-credit-for-married-filing-separately-qa/ 

https://finance.zacks.com/credits-lose-filing-married-filing-separately-2954.html 

you are also subject to the tax rules as to who can claim the children.

and that is the parent with the highest adjusted gross income

the suggested method is to do a joint return and married filing separate returns 

if you use this suggestion the desktop software may be cheaper because you won't be paying for 3 returns.