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Just married mid-tax year...questions on how to file?
1) I'm changing my state and federal forms to "Married 0" so that we don't take the chance to have to pay into the government. Is this the right route?
2) My husband has some issues with the IRS and we are thinking about filing separately instead of jointly....but we also have a son who is 5...and I used to claim him, the daycare tuition and my own student loan interest. I heard if we file "married separate" I cannot claim anything anymore. True, untrue?
3) Half the year I claimed "HOH" now have to switch to married....how will this affect my tax return?
Thank you Mathew and Judy...you are both very knowledgable and I appreciate your answers.
I think I am going to check "married but withhold at a higher single rate" just to be safe. (I used to file Single 1, but now will file Married 1 but at the higher single rate) We are going to file jointly and file the "innocent spouse relief" form. My husband owes back taxes, not much, but it's still something. We both make under $40,000 each...so about $75,000 together...don't know if that makes a difference here.
If you both make pretty decent money, it's possible that even married/0 won't have enough taken out for the year, so it's possible you could still end up having to pay.
You heard correctly that if you file as married filing separately you can't take a child care credit for the daycare, or deduct your student loan interest. Look into filing jointly but filing an injured spouse form. That way you'll get the part of the refund that's due to YOUR income and withholding - only his will be taken for what he owes.
If you claimed an additional allowance for HofH, then less was taken out of your checks that would have been withheld otherwise. This could lower your refund or end up having to pay.
One other thing - if you have been getting EIC, on a joint return both incomes are used to figure eligibility, so you might not be eligible. And if you file separately, that's another one of the credits you can't get at all.
If you are married on 12/31 of the tax year you are filing you must file as married filing jointly or married filing separately for the entire year. How you completed your W-4 forms during the year may have an effect on the amount of withholding but not your filing status.
There are a number of ways to avoid or deal with your husbands "IRS issues" but normally filing MFS is the least advantageous. Depending on your income level and the state in which you live you may want to consider filing an injured spouse claim which means that they will only take that portion of any refund associated to him.
Give the "issues" you may wish to consult with a tax professional before filing you return. They can run all of the options in the computer before you file to see what would be the best in your situation. You would also have the opportunity to have them explain all of your options going forward.