Filing Taxes Jointly for the first time this year? What to Consider.
If you tied the knot last year, you and your spouse have several decisions to make before filing your taxes.
Itemized vs Standard Deduction
It’s important to note that regardless of filing status, couples must decide whether to take the standard deduction or itemize their deductions in tandem. That is
Owing Back Taxes
If you are going to owe taxes on a joint return, or one spouse owes back taxes from prior to the marriage, then you may want to file separately, this prevents the innocent spouse from becoming liable for the tax debt of the other spouse and each spouse is responsible for their own taxes.
Higher Deductions
You may also qualify for higher deductions, because eligibility for medical expenses, charitable contributions and casualty losses is based on a percentage of AGI. Medical expenses become deductible to the extent they exceed 10% of AGI. Same with casualty losses and certain itemized deductions.
Other Expenses
If you choose to file separately you may also may be limited or disqualified from using certain tax breaks, like earned income credit, child and dependent care credit, adoption credit, student loan interest deduction as well as deductions for college tuition expenses.
More Information on Tax Planning and Innocent Spouse Defense
