Should wife and I file separately or together?

[swagner004]

We are currently residents of different states. We were married in May 2016. Unsure on filing separate or together. Both were residents of MI from 1/1/2016 to 8/14/16. On 8/15/16, I started work in WA as WA resident, and my wife moved to IL and is a resident there, but is currently on a travel work contract working in WA.

[Fern · Accepted solution]

For Federal taxes, it is almost alway better to file Married Filing Jointly. There are many deductions and credits that are limited or eliminated when using the Married Filing Separately status.

You can file married filing jointly for your state tax returns as well.

From the information above, you need to file state tax returns for MI and IL. WA does not have a state income tax. You would file as a part year resident in both states. You would also have to allocate your income to reflect what was earned in each state. As part of the question and answer for each state, you will be given an opportunity to report who had earned income in each state.

[swagner004]

Thanks for the feedback! That leads me to another question: With her as an IL resident and me as a WA resident, will I have to pay IL tax on my earnings made in WA because we are married?

[Fern]

You shouldn't. You can exclude your wages because you are not IL resident and the wages were not earned in IL.