Filing jointly or separately when married

How it works

A joint return combines both incomes and uses the married brackets and the married standard deduction of this year's official standard deduction married (not yet verified here; see the official source below). Filing separately gives each spouse brackets and a standard deduction that are half the joint figures, and the law closes several doors to separate filers: the earned income credit, the education credits, the student loan interest deduction, and the Roth IRA contribution phase out, which drops to almost zero for a separate filer who lived with their spouse. If one spouse itemizes, the other must itemize too. On a joint return both spouses are each fully responsible for the whole tax, while separate returns keep each spouse's liability their own. Separate filing is sometimes used when one spouse has an income driven student loan payment, large medical bills, or wants to keep the returns apart.

What it gives

A joint return usually produces the lower combined tax and keeps every credit available.

Separate returns keep one spouse clear of the other's tax debt and errors.

Separate filing can lower an income driven student loan payment that is figured on one spouse's income alone.

What it costs, or where the catch is

Separate filers lose the earned income credit, the education credits, and the student loan interest deduction.

Separate returns in a community property state still require splitting income down the middle.

A couple that files separately and later wants a joint return has a time limit to amend, and the reverse is not allowed.

A worked example

Jaya earns $70,000 and her husband Owen earns $30,000 as a teacher with federal student loans on an income driven plan. Jointly their payment is figured on $100,000 of income and comes to about $570 a month. Filing separately, Owen's payment is figured on his $30,000 alone and comes to about $0 to $60 a month, but they give up the education credit for his night classes, worth about $1,200 that year. The yearly payment difference of about $6,800 is weighed against the lost credit.

Where it goes wrong

The common miss is picking separate returns for one reason and forgetting that it also erases the student loan interest deduction and nearly all Roth IRA room for the year.

Who confirms it for you

For your own numbers, a CPA or enrolled agent. This page explains how the rule works for people in general; it does not know your situation and does not tell you what to do.

The official source

IRS Publication 501, Dependents, Standard Deduction, and Filing Information. Every figure that changes by year comes from the site's rules table, which the watcher checks against the official page on a schedule; where a figure is not yet verified, this page says so instead of printing a number.