Tax Filing Options for Couples: Joint vs. Separate
Every year, couples face the choice of whether to file their taxes together or separately. This decision can significantly impact their tax situation, particularly in light of changes introduced during Donald Trump’s administration.
Typically, tax laws favor those who file jointly. When couples do this, they combine their incomes, deductions, and tax credits into a single return. In contrast, filing separately means each spouse has their own return, dividing income and available tax benefits.
Gregory Guenther, a financial planner from New Jersey, notes that although he occasionally sees situations where couples benefit from filing separately, it’s usually a nuanced decision based on specific financial details rather than a standard approach.
During the 2023 tax year, IRS statistics show that around 55.5 million married couples filed jointly, in comparison to about 4.1 million who chose to file separately.
Couples who file jointly often benefit from a broader tax bracket, allowing them to earn more before hitting a higher tax rate. Additionally, the standard deduction for joint filers is significantly higher—$31,500 against $15,750 for those filing separately in 2025.
Drawbacks of Filing Separately
However, filing separately can lead to some unforeseen drawbacks. Lawrence Pong, a financial planner in California, mentions that it can disqualify couples from certain tax advantages, including deductions for contributions to Roth IRAs or traditional IRAs if their adjusted gross income surpasses $10,000.
Moreover, some popular tax breaks, like the new deductions for tip income and overtime pay, may not be accessible if couples opt for separate filings. Other tax benefits, such as the student loan interest deduction or the Child and Dependent Care Tax Credit, might also be adversely affected.
When Filing Separately May Be Wise
Despite the downsides, experts suggest that separate filings could make sense for some couples depending on their specific situations. For example, high-income couples living in states with high taxes may find better itemized deductions when filing separately. Guenther points out the federal deduction limit for state and local taxes (SALT), which may be increased to $40,000 for joint filers by 2025.
Another scenario to consider would be when one spouse incurs significant medical expenses that exceed 7.5% of their adjusted gross income, making a separate itemized deduction potentially beneficial. However, both partners must itemize or opt for the standard deduction, a choice that may not always benefit them equally.
Guenther emphasizes that deciding to file separately isn’t a straightforward win. Advisors should run tax projections for both options, as the most advantageous choice can change from year to year.
In most cases, the option to file separately is more of a tactical decision for a specific year rather than a long-term strategy. As Guenther puts it, “It only makes sense if the benefits are clear and measurable.”
