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Old 01-12-2014, 09:47 AM
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Recently married - how to file to maximize return?

Hello - I was married in Aug 2013. My wife and I rent our house and would likely take standard deductions. She makes $41k/year and I make $55k/yr. To maximize our return, is it better to file separately or jointly?

Thank you,
Ocho9
Albany, NY



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Old 01-12-2014, 03:39 PM
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Quote:
Originally Posted by Ocho9 View Post
Hello - I was married in Aug 2013. My wife and I rent our house and would likely take standard deductions. She makes $41k/year and I make $55k/yr. To maximize our return, is it better to file separately or jointly?

Thank you,
Ocho9
Albany, NY
In genral jointly;as married taxpayers, you can choose between filing a joint tax return or a separate tax return. The MFJ filing status provides more tax benefits than filing separate returns, butyou will need to weigh the pros and cons and decide for yourselves which is the best filing status.As you are married, then you and your spouse can filing a joint tax return. You are considered married if you are legally married on the last day of the year. The IRS advises that, "If you and your spouse decide to file a joint return, your tax may be lower than your combined tax for the other filing statuses. Also, your standard deduction ,if you do not itemize deductions, may be higher, and you may qualify for tax benefits that do not apply to other filing statuses. By filing a joint tax return, both spouses report all your income, deductions, and credits on one tax return. Both spouses must sign the return, and both spouses accept full responsibility for the accuracy and completeness of the information reported on the tax return. If the tax is unpaid, each spouse is held personally responsible for the payment. If the tax return is audited by the IRS, each spouse will be held responsible for providing documents to demonstrate the accuracy of the tax return. In other words, each spouse is held jointly and severally liable for the tax on a jointly filed tax return. Both of you may be held responsible, jointly and individually, for the tax and any interest or penalty due on your joint return. One spouse may be held responsible for all the tax due even if all the income was earned by the other spouse. The IRS may grant relief from joint liability for taxes through innocent spouse relief, separation of liability, or equitable relief. Filing a separate return provides relief from joint liability for taxes. However, married taxpayers who file separately are not eligible for many tax deductions and credits, and have higher tax rates. In general, it is more advantageous to file a joint return. There is one clear benefit of filing separately. By filing a separate return, you are solely responsible for the accuracy and payment of tax related to that separate return. By contrast, on a jointly filed return, both spouses are jointly responsible for the accuracy of the return and the payment of tax. A spouse who is unwilling to assume legal and financial responsibility for the other spouse's tax obligations should strongly consider filing separately.



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