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Maximizing Tax Savings: Is Separate Filing Right for Married Couples?
ARTICLE | June 25, 2024
Authored by Vasquez + Company
While most married couples file joint tax returns, there are scenarios where filing separately may be beneficial. This article explores the circumstances under which separate filing can be advantageous, such as concerns over a spouse's tax issues, significant unreimbursed medical expenses, qualified business income (QBI) deductions, and student loan repayment plans. It also highlights the importance of analyzing the impact on tax liability before making a decision.
Key Points
- Liability Concerns: Filing jointly makes both spouses equally liable for the tax on combined income, while separate returns limit liability to individual income.
- Medical Expenses: Separate filing may be advantageous if one spouse has significant unreimbursed medical expenses.
- QBI Deduction: Filing separately can help retain the QBI deduction if one spouse's income is below the threshold.
- Student Loan Repayments: Some income-driven repayment plans for student loans may benefit from separate filing.
- Tax Breaks: Some tax benefits are only available when filing jointly, so careful analysis is needed.
For more information, read the full article here.
Our firm provides the information for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. This article is not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided “as is,” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose
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