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.
Obama Looking to Stick the Wealthy With Even More Taxes
His second term in office is winding down, but President Obama would still like to raise taxes on high net worth individuals before he checks out of the White House at the beginning of next year. Although the president has already taken several measures to raise the effective tax rate on the wealthy, he is…
Which Tax Breaks Help High Net Worth Taxpayers the Most?
It’s no secret that the United States government generally taxes high net worth individuals at a much higher clip than those in the lower- and middle-income brackets. However, despite that fact, there are still many provisions in the tax system, if used properly, can help wealthy earners save on their taxes. So what are some…
Tax Preparers Get Busted for Fraudulent Practices
Every tax season is full of stories and tales of people who go to great lengths to avoid paying taxes. In addition there are dozens of reports of unscrupulous tax preparers that get caught trying to cheat the system: either their clients or the IRS, or both. We want to share a few of those…
Entrepreneur Think Deductions, Deductions, Deductions!
Are you an entrepreneur looking for a tax break? Entrepreneurs have a lot on their plate, including living with the financial risk of their entrepreneurial efforts. That’s why it’s so important for any entrepreneur to be aware of any and all deductions come tax time. There are dozens of deductions to be had, but the…