Should You File Joint or Separate Tax Returns?

From CPA Advisor, March 2015:

It’s common knowledge that in most cases it’s beneficial for a married couple fo file a joint tax return. However, there are some exceptions that you should know about.

For newlyweds, including numerous partners in same-sex marriages, this is the first year this election is available.

Background: Typically, when a couple combines their income and deductions, they fare better by filing a joint return on the federal level, especially if one spouse has significantly more income than the other spouse. Where each spouse earns roughly the same amount, the so-called “marriage penalty” can skew the results, forcing some couples to pay more tax on a joint return than they would owe if they were each single filers. However, recent tweaks in the tax brackets have reduced the impact of the marriage penalty. In any event, filing jointly is usually still preferable to filing separately as a married couple.

Usually…but not always. In some instances, filing separately will produce better overall tax results if one spouse has a disproportionate share of deductions subject to one of the tax law’s floors, such as medical or miscellaneous expenses. 

For the full article including examples visit: http://www.cpapracticeadvisor.com/news/12051753/is-it-better-for-couples-to-file-joint-or-separate-tax-returns

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