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JulieJ1988
New Member

Married filing jointly with separate brokerage accounts

What is the best way to file? We have separate Robinhood brokerage accounts. Some of our activity on these accounts are similar and some very different. I don’t want to get flagged for washout if the brokerage account activities are going to be combined since we are married. 

2 Replies
Opus 17
Level 15

Married filing jointly with separate brokerage accounts

Are you trying to avoid the wash sale rule? Did you coordinate your trades; For example, where one spouse sells stock to cash out a gain and the other spouse purchases it?

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
Opus 17
Level 15

Married filing jointly with separate brokerage accounts

Two of the comments on this old discussion would seem to be relevant to your situation.

https://ttlc.intuit.com/community/state-taxes/discussion/how-are-wash-sales-involving-spouses-treate...

 

If you file jointly, you are one taxpayer. You are definitely subject to the wash rule if one of you sold securities and the other bought them and you coordinated your activities.  

If you file separately, the IRS still considers spouses to be subject to the wash rule, although it may be harder for them to catch you. However, if you are audited, the fact that you filed separately will not protect you.  Filing separately can also result in other financial penalties, such as the loss of IRA deductions and the loss of certain child tax benefits, plus higher tax rates.  

The prior comment also notes that the tax courts do not always agree with the IRS that spouses are subject to the wash rule, it depends on whether the spouses invest independently or coordinate their activities.

 

If it is a large dollar amount you are worried about, you should get professional advice.

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
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