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More Information On Tax Filing (Status)...

Friday, January 11, 2013 - 11:14 AM

"In most cases, however, couples find they will generally pay more combined tax on separate returns than they would on a joint return. In some cases, at least one spouse's tax rate ends up higher than it would have been under a joint filing. Also, when a husband and wife file separate returns, they lose some tax credits and deductions they could have taken if they'd filed jointly.

Unless you are required to file separately, you should figure your tax on a joint return and on separate returns. This way you can make sure you are using the method that results in the lowest combined tax."

It seems to be a straightforward reminder.  My tax accountant usually does both (jointly and separately) to determine the best approach.
51hh51hh1,476 posts since
Jan 16, 2010
Rep Points: 6,427
1. Friday, January 25, 2013 - 1:57 AM
Hello all,

Income averaging is a federal tax code provision for people with widely varying income from one year to the next. It allows people who receive little income one year and huge income the next to reduce their tax liability by spreading out the tax bite on the huge sum over a three-year period. The 1986 Tax Reform Act abolished income averaging for all taxpayers except farmers, fishermen and certain qualifying retirees who cash out their retirement plans.

Thanks and Regards

Andy Thomas

StephenMooreStephenMoore5 posts since
Dec 26, 2012
Rep Points: 5