Why Do Newlyweds Believe Filing Separate Is Better?

[MRPLOW]

Just saved another one!

2 children, child tax credit reduced to $600 on MFJ return.
Put both children on wife's return and child tax credit bumped up to $1600.

MFS saved them $997 in federal taxes ($1,848 with Ohio tax savings).


These type of situations are not that uncommon if you have taxpayers with children, that both work and they both have incomes in the $40,000 - $125,000.

[powerage]

Here in Florida, because of no state tax, it is 98% of the time better to file jointly. At least with my clients.

I'm trying to save a couple of friends of mine, who got married in 2011, at least $1,000. If they choose to listen or not, their choice. The husband already filed MFS and missed out on a bunch of credits. They have the number to my boss, so hopefully they will follow through.

[taxmom34]

are both spouses filing as MFS? or is the one with the kids filing HH?

[MRPLOW]

Both spouses are filing MFS.

[MRPLOW]

Do the math. The child tax credit for MFJ starts to phase out at $110,00. For MFS it starts to phase out $55,000 for each spouse.

If one spouse earn say $75,000 and the other spouse earns $55,000, this would be a prime example.