Generally, filing jointly will give you a bigger refund or less taxes due. When you file separately, your tax rate is higher and you won't be able to claim:
- Education benefits
- Earned Income Credit (EIC)
- Child and Dependent Care Credit (usually)
- Adoption Credit (usually)
- The same benefit married filing jointly couples get for personal exemptions, itemized deductions, the Child Tax Credit, and capital losses (all of these deductions are reduced by half)
- Itemized deductions if your spouse has already claimed the standard deduction, or the other way around.
On top of that, if you live in the community property states of Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin, you have to deal with community property allocations and adjustments, which adds extra work and complexity to your tax preparation chores.
Tip: Only taxpayers who were still legally married as of December 31, 2015 are able to file as marrieds, whether jointly or separately.
The main reason you'd want to file separately is to protect yourself from inaccurate tax information reported by your spouse, or in cases where your spouse refuses to file a joint return (or refuses to file, period) and you don't want to get in trouble.
Also, when you file separately, your refund cannot be seized to pay off your spouse's debts. However, filing jointly as an innocent or injured spouse can head off refund seizures as well.
With all that in mind, you can try it both ways to see which filing status works out better for the both of you. If you do this, also consider your state return; in some cases, the taxes saved on the state return more than makes up for the money lost on the federal, or vice-versa.
You can try the different ways with TurboTax's free calculator TaxCaster. It will give you the estimated tax differences when filing either way.
- How can we compare married filing jointly with married filing separately?
- How do I switch from filing jointly to filing separately?
- Form 8379, Injured Spouse Allocation
- Innocent Spouse Relief
I cannot believe that turbo tax cannot generate filing separate returns based on the data entered for a married filing jointly return. Having to use separate logins and key in data that has already been entered is quite labor intensive and rather disappointing. Instead, I will use the information supplied and assume that filing separately will probably not be beneficial.
Request to Intuit (TurboTax):
I am a huge fan of your product, but it still needs more work and more user interface friendliness.
On this issue can you make it easier to compare without having to do 3 returns? The What-If Worksheet is not that intuitive and if we decide to change to MJS it is a pain. There needs to be an option to carry information over and pick a spouse for MJS returns. Please make this a user friendly option next year 2015 to save us time!
Your answer said:
How to compare filing separately vs. filing jointly
Using TurboTax Online —
- Prepare a joint federal and state return but don't file.
- Then prepare two Married Filing Separately returns
Please list the steps I use to open that second and third return.
People come to TurboTax AnswerXchange for help and answers—we want to let them know that we're here to listen and share our knowledge. We do that with the style and format of our responses. Here are five guidelines:
- Keep it conversational. When answering questions, write like you speak. Imagine you're explaining something to a trusted friend, using simple, everyday language. Avoid jargon and technical terms when possible. When no other word will do, explain technical terms in plain English.
- Be clear and state the answer right up front. Ask yourself what specific information the person really needs and then provide it. Stick to the topic and avoid unnecessary details. Break information down into a numbered or bulleted list and highlight the most important details in bold.
- Be concise. Aim for no more than two short sentences in a paragraph, and try to keep paragraphs to two lines. A wall of text can look intimidating and many won't read it, so break it up. It's okay to link to other resources for more details, but avoid giving answers that contain little more than a link.
- Be a good listener. When people post very general questions, take a second to try to understand what they're really looking for. Then, provide a response that guides them to the best possible outcome.
- Be encouraging and positive. Look for ways to eliminate uncertainty by anticipating people's concerns. Make it apparent that we really like helping them achieve positive outcomes.