I recently got married and I’m confused on how I should file my taxes. I have zero debt and always receive a return, but my husband has quite a bit of debt and always gets his returns taken. How do I file my taxes without having to pay for his debt?
You can file married filing separately----but you lose a lot of credits by filing that way. Or you can consider filing as an "injured spouse" to protect part of the refund that can be attributed to your own income. It is tricky and delays your refund, and it is even trickier if you are in a community property state.
If you were legally married at the end of 2021 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 $25,100 (+$1350 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.
First, be aware that the only debts that can be collected on by child support are federal debts (like taxes, or if he owes for some kind of federal contract dispute), child support, state unemployment, and education loans. Anything else might offset his state refund, depending on state law, but can't be offset from his federal tax refund.
Then you have three options.
1. File married filing separately (MFS). Each spouse files a separate return listing their own independent income and deductions. You will probably pay more tax this way, but whatever refund you claim is what you will get. Also note, this can be more complicated in community property states.
2. File jointly (married filing jointly, MFJ) and wait to see what happens. You file one joint return listing all your combined income and deductions. You will probably pay less tax because some credits and deductions are disallowed to MFS. If your entire refund is confiscated, you can file the injured spouse form to ask the IRS to reconsider and assign part of your joint refund to you rather than your spouse's debts. This can take 3-6 months to process, and you won;t know until it's over how much, if anything, you are getting back.
3. File MFJ and include the injured spouse form with your tax return. This will delay processing of your refund by 8-16 weeks. You won't get your entire refund or even half, but you should get something, and you won't know what you are getting until the deposit arrives.
Two additional important considerations.
The injured spouse form can only be used to protect your refund from debts your spouse incurred before the marriage. You can't use this form to protect yourself from debits your spouse incurs during the marriage.
Also, if you decide to file MFJ (with or without the injured spouse form) your agreement to file jointly means you are accepting joint and several liability for everything on that return, including income, deductions, taxes, and payments, as well as items accidentally or purposely left off that joint return. If your spouse is, let us say, not entirely responsible when it comes to money or taxes, agreeing to a joint return makes you equally responsible for that tax return, even if you later divorce.