Should My Spouse and I File Jointly or Separately?

If you’re newly married and it’s time to file your taxes, you may ask yourself: Should we file jointly or separately?

The best option is… up to you.

There are many benefits to filing jointly, and this is usually the best way to go. But there are circumstances in which you may choose to file separately.

Here is an overview of the benefits of both, and why you may want to choose one over the other.

Why you might want to file jointlyMature couple smiling and embracing.

The IRS encourages married people to file jointly by providing some juicy incentives. Filing jointly raises the income threshold for certain tax breaks, which can result in a bigger return or a lower tax bill. This works especially well if one spouse earns a bigger salary, or brings home all of the income.

You’ll enjoy some tax credits that are unavailable if you file separately, including the Earned Income Tax Credit, the American Opportunity and Lifetime Learning Credits, and the Child and Dependent Care Credit. Because of these benefits, the vast majority of married couples will file jointly, and it’s quite possible that you should, too.

When you should file separately

If you and your spouse have similar incomes, then combining them to file jointly might push you into a higher tax bracket forcing you to pay more in taxes. If this is the case, it might be more advantageous to file separately.

When you file jointly, the IRS holds you and your spouse equally responsible if there are any discrepancies or omissions. You might be better off filing separately if you suspect your spouse uses dubious filing techniques.

In reality, the only way to find the best course of action is to figure your taxes both ways. And of course, hiring a tax professional always helps.

 

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