We are filing married filing separately because we owe less money this way. However, we have a lot of medical expenses due to special needs kids. I am claiming my son and my husband is claiming my daughter. Can I just deduct ALL the medical expenses for all of us under my husbands filing since its all paid out of a joint account, or do I have to break up the medical expenses based on who claimed who?
For example, I claim my son, so the medical expenses I can claim is just me and my son, likewise my husband claims the medical expenses for just him and my daughter?
You are forgoing several child-related benefits by filing as Married Filing Separately, such as the Child Tax Credit or Earned Income Credit.
You should prepare your return both ways, Married Filing Jointly and Married Filing Separately, to see which one gives you the best tax benefits, especially with the new tax law changes.
But yes, you are correct that you can only claim your and your dependent's medical expenses on your return, as you suggested, so you would only claim you and your son's expenses.
Here's a detailed article you may find helpful:
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It is usually better to file Joint. Joint has the lowest tax rates and the highest Standard Deduction. And if you are in a Community Property state MFS gets tricky to figure out. Here's some things to consider about filing separately……
In the first place you each have to file a separate return, so that's two returns. And if you are using the Online version that means using 2 accounts and paying the fees twice.
Many people think they come out better when filing Married Filing Separate but they are probably doing it wrong. If one person itemizes deductions then the other one must itemize too, even if it's less than the standard deduction, even if it is ZERO!
And there are several credits you can't take when filing separately, like the
EITC Earned Income Tax Credit
Child Care Credit
Educational Deductions and Credits
And contributions to IRA and ROTH IRA are limited when you file MFS.
Also if you file Married Filing Separately up to 85`% of your Social Security becomes taxable right away even with zero other income.
COMPARE JOINT TO MSF
To compare Joint to MFS. If you are using the Online version, do NOT change anything on your return. You would have to start with a new account and do a test return. You don't have to pay unless you want to print it out. So you might need 3 accounts, one for Joint and two MFS, one for each spouse.
How to Compare Joint to Married Filing Separately
How to start another return in the Online version