How to Choose Your Tax Filing Status if You’re Married
If you’re married then you’ve probably just always filed a joint return with your spouse. In fact, chances are you’ve never even considered filing any other way. However, for some people, married filing jointly is not the best option. Depending on your situation, it could be more advantageous to file separately. Here are some things to consider when choosing what filing status to use if you are married.
While in many cases, filing together could help lessen the tax hit on you and your spouse it doesn’t always work that way. Sometimes, the only advantage of filing jointly is that you only have to worry about one return. If you and your spouse both work and one of you earns a lot more than the other, then it will typically be better to file jointly, as it will usually help reduce your combined tax bill.
On the other hand, there are other circumstances wherein it that might better to file separately. For example, if you both have taxable income and one of you has a lot of itemized deductions limited by adjusted gross income (AGI), then it might make sense to file separately. That’s because by filing separately, you can also separate both of your AGI’s. If your AGIs are lower on your separate returns, you can save on your tax bill.
This is just one example of where filing separately from your spouse could be helpful. However, it’s best to weigh all your options before making that choice. If you’re not sure what status to choose, you can contact us at GROCO for help. We’ll look at all the numbers and all the possible scenarios and choose the best path for you. Call us at 1-877-CPA-2006, or click here.
Recent Trends in the Venture Capital Community
Recent Trends in the Venture Capital Community Recently, I attended a Venture Capital Conference in which one of the speakers predicted we would see technology change in the next 15 years that would rival advancements similar to the past 100 years. That is a bold prediction, but as new technologies continue to emerge we are…
Tax Filing Mistakes
Tax Filing Mistakes Tax return anxiety is on the rise as the federal tax filing date looms. The prospect of filing an erroneous return increases as more rely on tax software to help prepare their returns. For the week ending March 28, more than 10,000 electronic returns were filed from home computers, an increase of…
Preparing Your Business Plan
Preparing Your Business Plan “Other things being equal, a well prepared business plan will increase your chances of obtaining the venture capitalist’s financial commitment.” Introduction A business plan is a description of your business. To be complete your plan should describe: Your company and industry The product The market and marketing approach How the product…
How to Recession-Proof Your Small Business
How to Recession-Proof Your Small Business The recent collapse of Bear Stearns & Co., one of the largest financial institutions in the world, has intensified the fears of most small business owners in the Bay Area despite an earlier, rosier prediction by the Association of Bay Area Governments that the recession would have minimal effect…