Married taxpayers can file joint tax returns together, or they can file separate returns, but the "married filing separately" (MFS) status provides the fewest tax benefits. There can be some advantages to this filing status, however, depending on your personal concerns and where you live.
What Is the Married-Filing-Separately Status?
You’re only responsible for your own tax return and your own tax payments if you're married and file a separate return. Your tax refund will be sent to the account you request on your return if you're due one. You won't be liable for taxes on the income your spouse earned. You can't be held legally responsible for any errors or omissions on your spouse's return, either.
The income spans for tax brackets aren't as generous if you use the married-filing-separately status. You'll be disqualified from claiming many tax deductions and credits as well. The income phaseout limits for other deductions will be harder to meet.
Some spouses just prefer to keep their finances as separate as possible.
When Should You File a Separate Return?
There are times when you must file separately. Sometimes, it might simply make the most sense for your personal situation.
You Lack Spousal Consent
Both spouses must sign the tax return when you file jointly, so you must file a separate return if your spouse can't or won't do so because they're unwilling or unable to consent to filing a joint return. An exception to this rule exists if one spouse dies during the tax year. You can still file jointly for that year if you choose, but you can file separately as well.
Different rules apply to married couples who file separately in community property states. They can impact the benefits or drawbacks of choosing the MFS filing status in those states.
There’s an Income Disparity
You might prefer to file an MFS tax return if your income is low and your spouse’s is high. You don't want responsibility for their tax bill. The Internal Revenue Service (IRS) can and will take steps to collect from you if your spouse refuses to pay a tax bill resulting from their income on a joint return, even if it's more money than you make in a year.
You Have Liability Concerns
Both spouses are "jointly and severally liable" for the accuracy of a jointly filed tax return. They're also jointly and severally liable for any resulting taxes that are due on that return. The IRS can collect tax debts and penalties from each of you. Both of you are equally responsible for any errors or omissions on the return.
Filing separately is one way to limit your liability if you don't trust your spouse. Perhaps your spouse has outstanding debts, such as back taxes or past-due child support, and you don’t want your refund to be seized to pay them.
An exception to liability exists if one spouse can prove a case for innocent spouse relief, proving that they had no knowledge of the other's misstatement of tax information. It would be unfair to hold them liable for any debt or penalties resulting from those misstatements.
You’re Applying for Certain Student Loan Repayment Plans
Another reason you may wish to file a separate return is to qualify for an income-driven repayment plan to lower your federal student loan payments. The Income-Based and Income-Contingent Repayment Plans and the PAYE Plan allow married borrowers who file separately to have their payments determined based on their incomes alone. They must be eligible for repayment under the terms of the plan.
You’re Getting Divorced or Are Separated
Filing jointly may not be in your best interest if you're headed for divorce. You can avoid a joint tax bill or a joint refund by filing separately, in addition to skirting those liability issues. Your refund will be directly deposited into an account you select if you're expecting one.
You may qualify to file as head of household if you have custody of your children and live separately from your spouse.
A Joint Return Wouldn’t Lower Your Tax Bill or Increase Your Refund
Filing separately doesn't present any real drawback if the combined taxes that are due on two separate tax returns are the same as, or very close to, the tax that would be due on a joint return. You'll receive protection against liability, even if you don't have any particular reason to worry about that.
How Married-Filing-Separately Status Impacts Taxes
Married-filing-separately taxpayers are prohibited from claiming some tax credits, including:
- Credit for the elderly and disabled (if they lived with their spouse)
- Child and dependent care credit (in most cases)
- Earned income credit
- American Opportunity or Lifetime Learning educational credits
MFS taxpayers also have lower income phaseout ranges for the child tax credit.
Deductions and Exclusions
Some tax deductions can become out of reach simply because both spouses must claim the standard deduction when they file separately, or they must both itemize their deductions.
The income phaseout threshold for the IRA deduction is lower if at least one of you is covered by a retirement plan at work. Some other deductions and exclusions are off limits for MFS filers as well. These include:
- The tuition and fees deduction
- The student loan interest deduction
- Tax-free exclusion of U.S. bond interest
- Tax-free exclusion of Social Security benefits
MFS status can be somewhat more beneficial for taxpayers who want to claim the itemized deductions with income threshold requirements. The medical expense deduction is only available for the portion of your expenses that exceeds 7.5% of your adjusted gross income (AGI) as of the 2021 tax year, the return you'll file in 2022. This can be a much lower threshold to meet on one income than on two combined incomes when you file jointly.
Your filing status also affects your tax rates. The following rates are in effect for those who are married but file separate returns for the 2021 tax year in 2022.
|2021 Tax Brackets|
|10%||$0 to $9,950|
|12%||$9,951 to $40,525|
|22%||$40,526 to $86,375|
|24%||$86,376 to $164,925|
|32%||$164,926 to $209,425|
|35%||$209,426 to $314,150|
|37%||More than $314,150|
The brackets increase somewhat income you earn in the 2022 tax year, the return you'll file in 2023. Tax bracket income thresholds (although not the percentage rates) are indexed for inflation, so they tend to increase a little from year to year.
|2022 Tax Brackets|
|10%||$0 to $10,275|
|12%||$10,276 to $41,775|
|22%||$41,776 to $89,075|
|24%||$89,076 to $170,050|
|32%||$170,051 to $215,950|
|35%||$215,951 to $323,925|
|37%||More than $323,925|
These MFS brackets are the same as those that apply to single taxpayers, with one major exception. The 35% tax bracket covers income up to $518,400 for single taxpayers, but those who are married and file separately hit the highest tax bracket of 37% at incomes of just $314,150—a difference of more than $200,000.
It's even more pronounced if you file a joint return with your spouse. In that case, the 37% bracket doesn't kick in until incomes reach $628,300 as of the 2021 tax year.
No two taxpayers can claim the same dependent unless they're married and file a joint return. Married taxpayers who are parents and who file separately must decide which of them is going to claim their child as a dependent for various tax breaks.
Your kids don’t have to be a package deal if you and your spouse file separately. Each of you can claim one child if you have two children, or one of you could claim two or three if you have four children, leaving the other dependents for the other spouse.
The IRS will award the dependent to the parent with whom the child lived more often during the tax year if the agency must decide the issue. It will give the dependent to the parent with the higher adjusted gross income (AGI) by default if parents live together.
Can You Change Your Filing Status Once You’ve Filed?
Married couples should decide whether they want to file jointly or separately when they prepare their tax return for the year, but they can change their minds and switch from two separate returns to a single joint return within three years from the due date of the original return, including extensions.
They can change their minds and switch from a joint return to two separate returns only by the tax deadline for that tax year.
You must submit an amended tax return, Form 1040X, if you want to change your filing status after filing your tax return.
The Head-of-Household Option
You or your spouse—or perhaps both of you—might qualify for the head of household filing status if you're living apart. This is much more advantageous than filing a separate married return, but it comes with a lot of qualifying rules.
You can't have lived together at any time during the last six months of the year if you’re not divorced yet. Your home must have been the primary residence of at least one of your children for more than half the year, or the primary residence of another dependent for the entire year. Some family members, such as your parents, don't have to live with you to qualify as your dependents, but you must have paid for more than half the cost of maintaining their household elsewhere.
You must pay for more than half the cost of your own household if your dependent lives with you.
You can claim the tax deductions and credits that would otherwise be unavailable to you if you’re eligible to file as head of household rather than MFS.
Married Filing Separately in Community Property States
Couples who reside in one of the nine community property states must follow special rules for allocating income and deductions when they file separately. The community property states are California, Arizona, New Mexico, Texas, Louisiana, Nevada, Idaho, Washington, and Wisconsin as of 2022.
Community property and income are jointly owned by both spouses. If your spouse earns $80,000, half of that is attributable to you regardless of the fact that you didn't personally earn it. Each spouse must report half the total community property income on their separate tax return, even if one never worked a day all year.
Deductions are also split in half, with each spouse reporting half the deduction on their separate return. These rules apply even if just one spouse lives in a community property state.
Frequently Asked Questions (FAQs)
Does filing separately affect taxes on Social Security benefits?
Social Security benefits may only be taxed up to 50% if you and your spouse don't live together, are making under $34,000, and plan on filing separately. Benefits can be taxed up to 85% if you have lived together or have more than $34,000 in income.
Is there a penalty for filing separately?
There isn't a penalty for using the married-filing-separately status, but there are tax breaks that you won't be eligible for if you don't file jointly. Most tax professionals will tell you that this status is the least advantageous for those involved.
- Spouses who file joint married returns are both liable for any tax due and for any errors or omissions, even if one of them didn’t earn the income or was unaware of mistakes.
- Spouses who file separate returns are only responsible for the tax due on their own income.
- Many tax breaks are off limits or less beneficial for married taxpayers who file separate returns.
- Married parents who file separate tax returns can’t both claim their children as dependents. Each dependent can only be claimed by one taxpayer.
IRS. "Signing the Return."
Federal Student Aid. "Do You Have Questions About the Different Types of Income-Driven Repayment Plans."
IRS. "Dependents, Standard Deduction, and Filing Information." Page 7.
Debt.org. "2020-2021 Tax Brackets."
IRS. "Instructions for Form 1040X." Page 5.
IRS. "Instructions for Form 1040X." Page 9.
AARP. "Social Security and Taxes."