MFS-Community Property State

[sami]

I am working on a new client who wants to file married filing separately though they lived together but the spouse has some student loans and they both have always filed taxes separately. Taxpayer and spouse live in community property state (WA) and the only income for 2023 is from taxpayer as the spouse is not working and have zero income. They have one child.
I understand that I need to prepare Form 8958 but my confusion is, do I file two 1040's marked as MFS and split all the income 50/50? Or should I just show all taxpayer income on MFS 1040 tax return for him along with 8958 and no 1040 for spouse? Who will claim the child?
Not sure how to proceed with this tax return and I am Drake user I couldn't figure out a way to split the MFJ tax return into 50/50.
Any help will be greatly appreciated. Thank you

[jmcdtax]

In Wisconsin, a community property state, split the income 50/50. It may benefit the spouse with student loans to claim the child. Are the student loans delinquent? It might be beneficial to compare MFJ versus MFS. Check Washington DOR as well to see what they require.

[FEDUKE404]

Unless something has changed, if a couple chooses married filing separately, NEITHER spouse can claim ANY student loan interest.
(I cannot address any WI issues.)

Also, if they have claimed student loan interest in the past while using MFS, one would think an efiled return showing same would automatically be rejected?

[Anarchrist]

MFS is not eligible for student loan interest deduction.

I can't imagine any computer program would calculate a interest deduction on a MFS return, so you wouldn't get to the point of the efile rejecting. If the computer calculation was overridden to take a deduction, the program may not allow the efile to be created. If the program allowed the return to be efiled, there's a chance the irs would reject it, but if not, it would be considered a math error which the irs computer would catch and adjust the refund or amount owed.

[Lion]

It sounds like OP's clients want to file MFS to lower the monthly student loan PAYMENTS for the spouse. jmcdtax already reminded OP to compare MFJ versus MFS so clients can make an informed decision about their total TAX liabilities and their total student loan REPAYMENT liability. That comparison will take into account the loss of credits and deductions vs the decreased monthly loan repayments.

Sami: contact Drake re how to split a MFJ return into two MFS returns in your software.