Caution: Each state has its own rules regarding this topic. For example, Arizona allows couples to file separately even if they filed a joint federal return, whereas Colorado does not. California doesn't allow it either, with the exception of active-duty military and certain nonresidents. Before proceeding further, make sure this is allowed by your state's tax laws.
You can use TurboTax Online to file separate state returns, but we recommend you use the CD/Download software version to do this because you'll only need to pay for one TurboTax product (you can file up to five returns).
Tip: If you already started your return in TurboTax Online, we recommend that you transfer your tax file to the CD/Download version. You will save time by entering less information.
Here's a brief overview of the procedure, see the sections below for detailed steps:
- Prepare one married filing jointly (MFJ) return to file with the IRS.
- Prepare a mock married filing separate (MFS) return for each taxpayer. This is for your records only and will be used to generate separate state returns for each person. The mock federal returns are not filed.
- Then, for the first taxpayer, label and use the first mock MFS federal return to prepare their state MFS return. Use only their income and their half of the deductions from the MFJ federal return.
- This ensures that TurboTax only transfers the first taxpayer's income to their married filing separate state return.
- File this MFS state return, not the mock federal return that it pulls the information from.
- For the second taxpayer (spouse), label and use the second "mock" MFS federal return to prepare their state MFS return. Again, use only their income and their half of the deductions from the MFJ federal return.
- File the second MFS state return, not the second mock federal return that it pulls the information from.
Be sure to name each TurboTax federal return so you know the MFJ federal return to file, and which mock MFS federal and state return is for which person.
Yes, this can be tedious, but this is often the best way to ensure you accurately minimize state tax situations with two different state incomes.
Note: State returns prepared using the mock federal returns will require you to print and file your state return by mail, please click here to learn more.
For detailed instructions, click the link below for the taxpayer(s) that need to file a state return.