Married Filing Separately for 2024 (filed MFJ in past years)?

[davidpassero]

Hello, I have Married Filing Jointly with TurboTax Online for the last 15 years and have all my and my wife's information loaded there.  But due to large Federal student loan payments, I need to file this year's taxes as Married Filing Separately.  I am seeing though that I cannot use my TurboTax online (at least that is what I think I read in this community?) and must instead pay $40 to download TurboTax Basic download and start each return (one for me and one for my wife, who also has income) from "scratch" like brand returns with no data, is that correct.?

[xmasbaby0]

You would not want to try using the same online account that has been used for past joint returns.   It is too messy to get all of the "spouse stuff" out and you will get errors.   When you use online to file married filing separately, you each need your own account and will pay for each one.  With online, you get one return per fee--unlike the CD/download ---with which you could prepare and e-file up to five federal returns.  If you have a full PC or Mac, you would be better off using the CD/download.

If you use the CD/download you only need ONE copy of it.  "Basic" does not include state software---so if you need to prepare state returns, get Deluxe.

CD/DOWNLOAD (This requires a full PC or Mac—-cannot be used on a mobile device)

https://turbotax.intuit.com/personal-taxes/cd-download/

You can also purchase the CD/download from various retailers such as Costco, Amazon, Walmart, Best Buy, Staples, Sam’s Club, etc. etc. etc.

This link Where can I obtain authentic TurboTax software? has a list of authorized TurboTax resellers.

When you use desktop software, there is an additional fee to e-file a state return.  You can avoid that fee if you print, sign and mail the state return.  The state e-file fee is $20 and increases to $25 in March.

https://ttlc.intuit.com/community/system-requirements/help/minimum-system-requirements-for-turbotax-...

https://ttlc.intuit.com/turbotax-support/en-us/help-article/product-system-requirements/minimum-syst...

[xmasbaby0]

And....you are focused on the student loan payments---but do you know about the disadvantages of filing MFS and know about some of the credits you may lose by filing that way?

If you were legally married at the end of 2023 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 get the married filing jointly standard deduction of $27,700 (+$1500 for each spouse 65 or older)  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. Your limit for SALT (state and local taxes and sales tax) will be only $5000 per spouse. 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 since with online, you get one return per fee.

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

https://ttlc.intuit.com/questions/1894449-is-it-better-for-a-married-couple-to-file-jointly-or-separ...

[davidpassero]

Yes, I do understand the deductions and credits I do not get because Im switching to MFS  but the federal student loan savings FAR outweigh that.  I do live in Texas so fortunately I do not have to file state taxes, but unfortunately it is a Community Property State so I think I have to list my spouses income to ensure Im not double dipping, but I dont think spousal income is listed on the 1040 for federal taxes?1040, does it?

[xmasbaby0]

If I am filing a separate return why do I have to list my spouse’s information on my return?

Even if you file separate returns (the worst way to file) you each have to list each other's SSN's and some other information on your own tax return.  The IRS can then cross check to make sure you are not "double dipping" for itemized deductions, dependents, etc.

If you are in a community property state, there is more information that will be needed.

Community property states:  AZ, CA, ID, LA, NV, NM, TX, WA, WI

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

https://turbotax.intuit.com/tax-tips/marriage/five-tax-tips-for-community-property-states/L4jG7cq7Z