Can I Choose Married Filing Separately?

Married Filing Separately Filing Status

There has been always a doubt in choosing the right fling status, to choose whether Single Tax Filing, Married Filing Jointly or Married Filing Separately. Let’s go through the details and information below about eligible filing statuses.

What is Married Filing Separately (MFS)?

MFS – Married Filing Separately is a tax filing status on tax returns where a couple choose to file taxes separately or do not want to file their tax returns jointly. The standard deduction for the Married Filing Separately is $12400.

Who can File MFS – Married Filing Separately?

A married couple can file their tax returns separately by disclosing their income on a separate tax returns, it means both the spouses will show their income and claim their exemptions, deductions credits separately by choosing Married Filing Separately status.

What is Married Filing Separately features?

  • Married Filing Separate tax return will make you pay more taxes, since there is a difference in tax brackets comparing to Married Filing Jointly.
  • You are going to disclose only your income, credits, deductions and exemptions on your tax return.
  • You can claim your spouse exemption if she does not have any gross income, not filing her tax returns or she is not being claimed on another person’s tax return.
  • 50% of exemption amount is allowed to claim as Alternative Minimum Tax when it is joint tax return (MFJ).
  • Premium Tax Credit, Earned Income Tax Credit, Adoption, Education, Child Care, may be limited or may not be allowed.
  • The deduction on capital losses is just $1500 which is half of the allowable deduction on a Married Filing Joint tax return.
  • The standard deduction is $12400 which is half of the amount of Married filing joint $24800, cannot be claimed when a tax payer spouse itemizes deductions.

What are the reasons for filing MFS – Married Filing Separate tax returns?

  • One of the spouse does not want to be responsible for the other spouse tax obligations.
  • The other spouse has a large casualty loss or high medical expenses.
  • If Married Filing Separately may lower tax liability or lower adjusted gross income, which can allow a spouse to claim more expenses or losses.
  • To offset the other spouse debt

Which is the next beneficial filing status?

You can choose HOH- Head of the household filing status if you have lived separately from your spouse and meet your expenses, it is applicable though you are not divorced or lawfully separated.

Married Filing Jointly and Head of the Household filing statuses will reduce your tax liability when compared with Single and MFS  based on your income threshold, so you can claim Earned income Tax Credits or other Tax Credits.

The head of the household will help you choose standard deduction though your spouse chose to file itemized tax returns.

What types of forms are used in Married Filing Separately?

You can file Form 1040 if your income is less than $100,000, you can even file Form 1040A.

Married Filing Separately rules:

  • Your tax rate will be higher to Married Filing Joint tax return.
  • Allowable AMT- Alternative minimum tax will be 50% of Married Filing Joint tax return.
  • You cannot opt Child Tax Credit and Dependent Care expenses.
  • You can only claim your employer provided dependent care benefits up to $2500 than $5000 which is for Married Filing Joint tax return.
  • You will not be able to opt Earned Income Credit.
  • Cannot claim expenses on child adoption.
  • Cannot opt Education Credits like: American Opportunity Credit and Lifetime Learning Credit.
  • You may have to pay tax on interest income earned on U.S. Savings Bonds bought for education expenses.
  • You cannot claim the standard deduction if your spouse files her tax returns as itemized. If you could claim standard deduction, your basic standard deduction is 50% on the allowable amount of Married Filing Joint tax return.
  • If your AGI- Adjusted Gross Income is lower to Married Filing Joint tax return, then you can claim your complete eligible medical expenses based on your AGI.
  • You might not be able to claim your contributions towards IRA – Individual Retirement Account, if you or your spouse were under the cover by your employer provided retirement plan for the tax year. Your deductions can be eliminated or reduced if your income is crossing certain thresholds.

Can i change my Married Filing Separate tax return to Married Filing Joint return?

Yes you can change your filing status from Married Filing Separately to Married Filing Joint tax return, You change your filing status within last three tax years. Married Filing Separately, Single and Head of Household are considered as separate tax returns and the required tax return form is Form 1040X.

Can i change my filing status from Married Filing Jointly to Married Filing Separately?

You cannot amend your tax return from Married Filing Joint to Married Filing Separately, but there are exceptions.

Choosing right filing status which can help you save your taxes is a tedious job, since there are various rules needs to be cautiously followed. Because mistakes can happen by various ways which can ask for expensive notices, enquiry’s, audits from IRS or State Income Tax Departments.

Crescent Tax Filing has well understanding about IRS and State tax laws, rules, procedures. Since Crescent tax filing is well organized, operated and managed by dedicated tax professionals who have decades of experience in all kinds of U.S. taxes.

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Married Filing Separately filing Tax Brackets 2020

Up to $9,875 10% on Taxable Income
$9,876 up to $40,125 $987.50 + 12% additional tax over the income of $9,875
$40, 126 up to $85,525 $4,617.50 + 22% of additional tax over the income of $40, 125
$85,526 up to $163,300 $14,605.50 + 24% of additional tax over the income of $85,525
$163,301 up to $207,350 $33,271.50 + 32% of additional tax over the income of $163,300
$207,351  up to $518,400 $47,367.50 + 35% of additional tax over the income of $207,350
$518,400 and Over $156,235 + 37% of additional tax over the income of $518,400

Posted in Married Filing Separately.