Maximise covid19 stimulus payment by changing filing status

[stbasil123]

Hi

My spouse makes less than me and she is eligible for $1200 stimulus check for herself and $1000 for 2 kids if file status change to married filing separately with 2 dependent. when I tried my joint return it seems we get only around $1100 as my income is higher. By changing to married filing separately I have to pay little more than what I supposed to pay if filing jointly but when I look into net affect I make $900 extra. Can I do that way?

Thanks

[LeonardS]

Both you and your wife will each receive a stimulus check for $1,200 and you will receive $500 per child for a total of $3,400 in stimulus payments.  You will receive this amount regardless of your filing status.  

Generally, if you are married it is more advantageous to file jointly.  Whether or not you file jointly or separately is your choice. When you file MFS you will lose out on many of the tax credits available to those who file MFJ.  The following TurboTax article was written to help couples decide the best way to file.  Should You and Your Spouse File Taxes Jointly or Separately?

[stbasil123]

Thanks for your reply. But as I mentioned if we file jointly we will get around $1000 only as our adjusted gross income is around $185k. That means I make more than my spouse make. In this situation, to benefit maximum stimulus refund can I file MFS if other credits does not make much difference? Please let me know. Once again thank you so much for your valuable advise

[DoninGA]

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@stbasil123 wrote:

Thanks for your reply. But as I mentioned if we file jointly we will get around $1000 only as our adjusted gross income is around $185k. That means I make more than my spouse make. In this situation, to benefit maximum stimulus refund can I file MFS if other credits does not make much difference? Please let me know. Once again thank you so much for your valuable advise

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So, just to be clear, you realize that you will be losing $12,200 from the Standard Deduction when you file separately, this is not a concern?

You may want to review this TurboTax support FAQ for filing jointly versus separately - https://ttlc.intuit.com/community/married/help/is-it-better-for-a-married-couple-to-file-jointly-or-...

[LeonardS]

Yes, if you have determined that your overall tax liability is lower (larger total refund) by filing separately then there is no reason not to file separately.

[stbasil123]

Yes, this is what I was looking for. I tried in both ways and seems filing separately I will be ending up paying more tax which is about $300 extra. But filing separately I get $1300. so net affect is $1000 extra for me. Also, if they come up with another stimulus which is more likely, I will get that too. Thanks for replying my query. I will be making this as marked

[stbasil123]

>>So, just to be clear, you realize that you will be losing $12,200 from the Standard Deduction when you file separately, this is not a concern?

I am not clear what you meant. My understanding is when I file MFS my spouse can show std deduction of $12200 for her return and myself can show $12200 in my return as well. Is  that right? I am not going to do schedule A anyway as I have nothing to show up there as mortgage interest etc. Please confirm

[DoninGA · Accepted solution]

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@stbasil123 wrote:

>>So, just to be clear, you realize that you will be losing $12,200 from the Standard Deduction when you file separately, this is not a concern?

I am not clear what you meant. My understanding is when I file MFS my spouse can show std deduction of $12200 for her return and myself can show $12200 in my return as well. Is  that right? I am not going to do schedule A anyway as I have nothing to show up there as mortgage interest etc. Please confirm

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Your understanding is clear.  I just wanted to point out that you will be losing the $12,200 from the Joint tax return when making the decision to file separately.  

The other issue is that your tax brackets change when changing from a joint return to a separate return, thereby increasing your tax liability on your taxable income.

[stbasil123]

Thank You