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posted Jun 6, 2019 9:58:13 AM

Is it ok to file as "married, filing separately" if your spouse has a 1099misc? I noticed the refund dropped significantly after entering this info.

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1 Best answer
Level 15
Jun 6, 2019 9:58:18 AM

If you were legally married at the end of 2017 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 $12,700 (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, adoption 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. The amount you can contribute to a retirement account will be affected. If you live in a community property state, you will be required to provide additional information regarding your spouse’s income. ( Community property states:  AZ, CA, ID, LA, NV, NM, TX, WA, WI) If  you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice.

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

https://ttlc.intuit.com/questions/1901162-married-filing-separately-in-community-property-states


3 Replies
Level 15
Jun 6, 2019 9:58:18 AM

If you were legally married at the end of 2017 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 $12,700 (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, adoption 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. The amount you can contribute to a retirement account will be affected. If you live in a community property state, you will be required to provide additional information regarding your spouse’s income. ( Community property states:  AZ, CA, ID, LA, NV, NM, TX, WA, WI) If  you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice.

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

https://ttlc.intuit.com/questions/1901162-married-filing-separately-in-community-property-states


Level 15
Jun 6, 2019 9:58:21 AM

A form 1099-MISC is additional taxable income. There is usually no tax withheld on a 1099-MISC. If you add income with no additional withholding, naturally your refund will be reduced because you have to pay tax on the 1099-MISC income. If the 1099-MISC is self-employment income (in box 7) you have to pay self-employment tax as well as income tax.

You can file separately, but unless you live in Ohio, you will almost certainly pay more tax altogether than if you file jointly.

Level 15
Jun 6, 2019 9:58:23 AM

Yes, it is OK to file as Married Filing Separately (MFS) when you spouse has a 1099-Misc. But, the type of income is not relevant to deciding between MFS and MFJ. MFS is seldom better and is usually much worse. But the only way to be sure is do test returns both ways. 

Try this tool https://turbotax.intuit.com/tax-tools/calculators/taxcaster/?s=1