Ask The Hammer – Filing Taxes Jointly vs. Separately
Should a newly married couple file their taxes separately or jointly?
Key Takeaways
- File married filing jointly in most cases to minimize tax liability and access more tax code benefits; this is the default recommendation for married couples seeking the lowest overall tax costs
- When filing jointly, both spouses become jointly liable for all information on the return, so verify that your spouse's reported income and deductions are accurate to avoid shared responsibility for any tax penalties or bills
- If one spouse owns a business and the other earns significantly more income, filing separately may prevent the higher earner from phasing out the business owner's Qualified Business Income (QBI) deduction by up to 20%
- Couples with large age differences should evaluate whether filing separately could help the older, lower-income spouse avoid IRMAA (Income-Related Monthly Adjustment Amount) penalties on Medicare premiums
- Use professional tax software or a tax professional that includes validation checks to flag filing status scenarios that may be suboptimal, since standard consumer tax software may not account for non-tax items like IRMAA
Ask The Hammer - Filing Taxes Jointly vs. Separately: In this episode of Ask The Hammer, Jeffrey Levine answers the question: Should a newly married couple file their taxes separately or jointly? Watch more episodes of Ask The Hammer at this link: https://www.finstream.tv/videos/ask-the-hammer/
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