This post was originally published on May 22, 2023, and extensively updated on July 10, 2024.
When it comes to filing taxes, married people must decide whether to file jointly or separately. It’s a decision that can impact their finances in several ways. For that reason, it’s important to consider all potential ramifications before filing your taxes.
At CMP, we advise our married clients on the best way to file their taxes to minimize their tax burden and maximize the advantages of being married. That said, each couple has unique financial circumstances, and what works for one may not work for another. Here is our guide to choosing married filing jointly vs separately.
Tax Implications of Getting Married
Getting married has tax implications that go beyond choosing a filing status. Here are some
- Name changes: If one spouse is taking the other’s surname, you’ll need to inform the Social Security Administration so they can update their records.
- W-4 forms: If one or both of you work, you’ll need to update your W-4 forms with your employer to reflect your marital status.
- Tax brackets: Your tax bracket may change after you get married, particularly if one spouse has a much higher or much lower income than the other.
- Capital gains: If one or the other of you owned a home before your marriage, getting married can impact how much capital gains you can exclude if you sell the home.
We’ll go into greater detail about tax brackets later in this guide.
Is It Better for a Married Couple to File Jointly or Separately?
One of the questions we hear most frequently from newly married couples is whether filing separately or jointly is more advantageous. While there are undeniable advantages to filing jointly, some circumstances when filing separately may make sense.
Let’s start with when it makes sense to file jointly. The most obvious scenario is if one spouse will be working and the other will not. In that situation, filing jointly is beneficial because the 2023 standard deduction for joint filers is $27,700 as compared to $13,850 for people who are married and filing separately. For 2024, these standard deductions increase to $29,200 and 14,600, respectively. If one spouse is not required to file because they have no income, the couple should file a joint return to take advantage of the higher deduction.
If you have large itemized deductions on the other hand, it may make more sense to file separately to maximize your allowable deductions. There are also benefits to filing separately for couples who are separated and/or planning to divorce.
Overview of Married Filing Jointly
Married couples who file jointly complete a single tax return that reflects their income and all shared assets.
Tax Benefits of Married Filing Jointly
Here are the most significant benefits of filing jointly as a married couple:
- Larger standard deduction: As we noted above, there’s a larger standard deduction for married couples that’s advantageous if only one spouse is working.
- Access to tax credits: Married couples who file jointly may be able to qualify for generous tax credits, including the Earned Income Credit, the American Opportunity Tax Credit, the Child and Dependent Care Tax Credit, the Lifetime Learning Credit, and the Saver’s Tax Credit.
- Higher refund/lower tax burden: By taking advantage of the larger standard deduction and available tax credits, married couples may end up getting a larger refund (or owe less) if they file jointly than they would if they filed separately.
- Higher retirement account deductions: Married couples who file jointly can benefit from higher deductions for their contributions to retirement plans.
Disadvantages of Married Filing Jointly
Here are a few potential disadvantages to filing your taxes jointly:
- Medical deductions: You can only deduct medical expenses if they exceed 7.5% of your adjusted gross income. In some cases, filing separately will allow you to deduct more of your medical expenses because your income is likely to be lower, making it possible to meet the threshold required by the IRS.
- Tax liability: When you file a joint tax return, each spouse is responsible for the total combined tax liability of the couple.
What Are the Requirements for Married Filing Jointly?
The requirements to use married filing jointly as a tax status are simple. The only requirement is that the couple in question must have been married by December 31 of the tax year.
For example, if you and your spouse want to claim joint status for the 2024 tax year, you may do so provided you are married on or before December 31, 2024.
To choose married filing jointly, simply check the “married filing jointly” box at the top of Form 1040.
Overview of Married Filing Separately
While there are significant advantages to filing jointly, filing your taxes separately also brings some potential benefits.
Tax Benefits of Married Filing Separately
Here are some potential advantages to filing separately:
- No liability for your spouse’s tax debt: If a spouse has reason to mistrust their partner or believes they may not have disclosed their tax liability, filing separately shields each spouse from the other’s tax liability.
- Medical deductions: As noted above, filing separately may allow for a higher medical expense deduction than filing jointly.
- Lower tax bracket: In some cases, filing separately may result in a lower total tax burden, specifically when one spouse has significantly less income than the other.
Disadvantages of Married Filing Separately
Finally, here are the downsides of filing separately:
- Lower standard deduction: Couples who file separately must each take a lower standard tax deduction than they would if filing jointly. In some cases, particularly if one spouse has little or no income, the lower standard deduction can be a disadvantage.
- Fewer tax credits: As we noted above, couples who file separately lose out on potential tax deductions that may increase their refund or decrease the amount they owe.
- Two tax returns. The most obvious disadvantage of filing separately is that you must complete two tax returns, which may take more time and cost more than filing a single, joint return.
- Tax credit exclusions: Couples who file separately cannot take the tax credits that are available only to couples who file jointly.
- Lower IRA contribution deductions: If you file separately, you’ll each be limited in the amount you can deduct based on your retirement account contributions. As a result, you may save less for retirement.
How Do You Decide Whether to File Taxes Jointly or Separately?
Are you and your spouse better off filing your taxes jointly or separately? In this section, we’ll walk through several ways to address the question and make the best decision for yourself and your finances.
Compare Tax Percentages
One of the easiest ways to gauge the impact of married filing jointly or separately is to look at the tax table for each spouse’s income separately and then combine. Here’s an example using 2023 tax brackets:
Spouse 1: Taxable income of $50,000; must pay $5,147 + 22% of the amount over $44,725 for a total tax amount of $6,307.50.
Spouse 2: Taxable income of $200,000; must pay $37,104 plus 32% of the amount over $182,101 for a total tax amount of $42,831.68. Combined with the other spouse, the total tax amount would be $49,139.18.
If we add the two spouses’ incomes together, we get to a total taxable income of $250,000. That would mean the couple must pay $32,580 plus 24% of the amount over $190,750 for a total tax amount of $46,800.
In this simple example, we see that by combining their incomes, this couple would end up paying $2,339.18 less in taxes than they would if they filed separate returns.
Compare Deductions
Another way to decide whether it’s best to file jointly or separately is by calculating each partner’s taxes with deductions and then calculating the combined deductions.
One scenario we’ve already mentioned is if one couple has accrued significant medical expenses during the tax year. In that case, filing separately may be advantageous because of the limits on medical deductions. Since you can only deduct expenses that exceed more than 7.5% of your adjusted gross income, it may be preferable to file separately in some circumstances.
Using our example above, let’s imagine that the spouse with the $50,000 income had an adjusted gross income of $44,000. If they had medical expenses of $10,000 during the year, they would have $6,700 in medical expenses they could deduct. (That’s $10,000 less 7.5% of AGI or $3,300.)
If we looked at that $10,000 of medical expenses as a percentage of the couple’s joint adjusted gross income of $230,000, it wouldn’t even come close to making the 7.5% threshold of $17,250.
You may want to compare other deductions as well, particularly if one or both partners own property that’s in their name only, and you don’t live in a community property state. There are limitations on mortgage interest deductions. At the same time, you should also be sure that you’ve taken any deductions that apply to couples who file jointly that you couldn’t take advantage of if you filed separately.
One final note regarding deductions is that if you file separately, you must choose the same option for deductions. In other words, if one of you takes the standard deduction, you must both take it; if one of you itemizes deductions, you will both need to do so, or the spouse who doesn’t itemize will receive a standard deduction of zero.
Consider Tax Liability and Transparency
Depending upon your circumstances, you may also want to look at your tax status from tax liability and transparency standpoint. When one spouse believes that the other may have hidden their tax liability or income, it may be best to file separately.
Separate filings can help shield a spouse from their partner’s wrongdoing if it exists. It can minimize the risk of being held liable for their partner’s taxes if there’s an issue. For this reason, couples who are separated or in the process of a divorce may choose to file separately.
So, let's look at your tax filing options and if you should file a separate tax return or a joint tax return,
Tips for Making the Most of Married Filing Jointly vs Married Filing Separately
Here are some tips for making the most of your tax filing status, whichever option you choose:
- Keep in mind that according to the IRS, you are married for the entire tax year if you were married on the final day of the tax year. Couples who get married toward the end of a year get the same tax benefits as couples who were married for the entire year.
- If you’re unsure which option will be most advantageous for you, we recommend doing side-by-side calculations to compare. Comparing joint tax returns with separate returns will highlight the advantages and disadvantages of each option.
- Keep your retirement savings in mind; The deduction limits for contributions to retirement plans are significantly higher if you file jointly than if you file separately.
- Couples who live in a community property state may want to hire a tax professional to assist with their returns. This distinction is particularly important if you are considering filing separately. As of this writing, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin are all community property states.
These tips can help you evaluate your options and choose the filing option that makes the most sense to you and your financial situation.
Can You Change a Past Filing Status from Married Filing Separately to Married Filing Jointly?
There may be justification to change your filing status from married filing separately to married filing jointly.
According to the IRS:
If either you or your spouse (or both of you) file a separate return, you can generally change to a joint return within 3 years from the due date (not including extensions) of the separate return or returns. This applies to a return either of you filed claiming married filing separately, single, or head of household filing status. Use Form 1040-X to change your filing status.
You should know that the same leniency doesn’t apply in reverse. If you and your spouse filed a joint return, there is no recourse to change your filing status to married filing separately after the due date of your return.
There is one exception. If one spouse dies, the decedent's personal representative may request a change to married filing separately within “one year from the due date (including extensions) of the joint return.”
Final Thoughts on Married Filing Jointly vs Separately
The decision of whether to file your tax returns jointly or separately deserves careful consideration and may require assistance from an experienced tax professional to ensure you take advantage of all available tax credits.
Do you need advice about filing taxes with your spouse? CMP is here to assist you! Read about our income tax services and schedule a free consultation today.
