Should Married Couples File Their Taxes Jointly or Separately?

Amherst, NH Resident Seeks Advice

Married couples filing their taxes jointly can take advantage of a number of tax credits that aren’t available to couples filing separately including the Earned Income Tax Credit, Child and Dependent Care Credit, Student Loan Interest Deduction and Tuition and Fees Deduction.  The assumption may be that filing separately will put you in a lower tax bracket, however the tax brackets have a lower income threshold when filing separately.

A resident in Amherst, NH had just gotten married.  Unsure whether it would be more beneficial to file taxes jointly or separately with his wife, he sought the advice of Merrimack Tax Associates.

IRS Discourages Married Couples from Filing Separately

The IRS would prefer that married couples file their taxes jointly, and thus makes it more advantageous to do so.  Married couples filing separately pay higher taxes for lower income, eliminating any advantages that they may mistakenly think this would offer.

The many deductions available for married couples also make sense for filing jointly.  Many itemized deductions available are significantly reduced when filing separately.  When filing jointly, you qualify for a higher income threshold, allowing for larger income levels to still take advantage of these deductions.

Scenarios Where You Would Want to File Separately

There remain a few scenarios where it is more financially beneficial for a married couple to file their taxes separately.  If there are significant itemized deductions that are limited by gross income, the numbers may be in your interest to file separately.  If you would prefer to keep your tax liability separate from your spouse’s, or if you are separated and living independently, though not yet divorced, filing separately is a good option. 

Convinced by the facts, the newlywed couple in Amherst will be filing their taxes jointly for 2019 with the help of the experts at Merrimack Tax Associates.