Married Filing Jointly vs. Married Filing Separately: Which is Right for You?

Tax season is here, and if you’re married, you have a big decision to make. Should you file your taxes together or separately? Choosing between “Married Filing Jointly” (MFJ) and “Married Filing Separately” (MFS) can impact how much you owe or get back. It can be a difficult choice for married couples to decide, and they want to get the most out of their tax returns.

Making the right choice isn’t always straightforward, and it depends on various factors like income, deductions, and financial responsibility. Some couples save more money by filing jointly, while others benefit from filing separately. Let’s break down the pros and cons of each to help you make the best decision. Our professionals at Flexkeeper are here to help you navigate the process. It’s our goal to make tax season as seamless as possible! 

What Does It Mean to File Jointly or Separately?

When you’re married, the IRS gives you two filing status options. We are going to explain each of them in a little more detail to give you a better understanding of what they mean. 

• Married Filing Jointly (MFJ): You and your spouse combine your income, deductions, and credits on one tax return. If you’re owed money, you get it back in one deposit. If you owe money to the IRS, you get one amount to pay back.
• Married Filing Separately (MFS): Each spouse files his or her own tax return, reporting only your income and deductions. Two separate transactions are made, whether you have to pay or get money returned. 

These choices affect how much tax you owe, what deductions and credits you can claim, and even your legal responsibility for tax liabilities. Below, we’ll go into more detail about the advantages and disadvantages of each option.

Married Filing Jointly: The Pros and Cons

Pros of Filing Jointly

1. Lower Tax Rates – Joint filers usually get lower tax rates than those filing separately. Tax brackets are structured so that combined incomes generally result in less tax liability.
2. Bigger Deductions & Credits – Couples filing jointly can claim valuable tax breaks like the Earned Income Tax Credit, Child Tax Credit, and credits for education.
3. Higher Standard Deduction – In 2024, the standard deduction for joint filers is $29,200, compared to $14,600 each for separate filers. This means more of your income is protected from taxation.
4. Simpler Process – Filing one return is easier, requires less paperwork, and often costs less in tax preparation fees. 
5. More Favorable Retirement Contribution Limits – Couples filing jointly may qualify for higher contribution limits on retirement accounts, such as IRAs, allowing them to save more tax-deferred money for the future.
6. Easier Qualification for Some Tax Benefits – Many tax benefits and deductions are only available or are reduced when couples file separately. This means that filing jointly usually results in more tax savings overall. This isn’t always the case, however. 

Cons of Filing Jointly

1. Shared Responsibility – Both spouses are responsible for any mistakes, tax bills, or penalties. If you aren’t working with a tax professional, it can be easy to make a mistake. 
2. Possible Higher Income Bracket – If your combined income pushes you into a higher tax bracket, you might owe more than if filing separately.
3. Limited Deductions for Medical Expenses – Medical expenses can only be deducted if they exceed 7.5% of your adjusted gross income (AGI), which is harder to reach when incomes are combined.
4. Potential for Loss of Individual Benefits – If one spouse has a lower income and qualifies for certain tax credits or deductions on their own, filing jointly may disqualify them from receiving those benefits.  

Married Filing Separately: The Pros and Cons

Pros of Filing Separately

1. Protection from a Spouse’s Tax Issues – If your spouse owes back taxes, child support, or student loans, filing separately can help reduce that burden.
2. Lower Taxes in Certain Situations – If one spouse has high medical bills or significant itemized deductions, filing separately might allow them to qualify for bigger deductions.
3. Avoiding Income-Based Phaseouts – Some deductions and credits phase out at higher incomes. Filing separately may help keep one spouse below these limits, preserving valuable tax breaks.
4. Financial Independence – If one spouse has concerns about the other’s financial habits, filing separately ensures that they aren’t responsible for the other’s tax obligations.
5. Better for Certain Legal Situations – In cases where a couple is going through a divorce or legal separation, filing separately may make sense for legal and financial protection.
6. Payback Programs –  There are government programs available that offer to pay back student loans in exchange for years of service in the public sector.  To take advantage of this, often one of the requirements is filing separately from your spouse.

Cons of Filing Separately

1. Higher Tax Rates – Separate filers often pay more in taxes compared to joint filers due to less favorable tax brackets.
2. Loss of Tax Credits – Filing separately means missing out on major tax credits like the Earned Income Tax Credit, Child and Dependent Care Credit, and some education credits.
3. Smaller Standard Deduction – Each spouse only gets a $14,600 standard deduction instead of the $29,200 available to joint filers, meaning more of their income is taxed.
4. More Complicated Filing – Filing two tax returns means extra paperwork, time, and possibly higher tax preparation fees. (also a potential of errors if you’re filing by yourself)
5. Limited IRA Deduction – If one spouse is covered by a workplace retirement plan, the ability to deduct IRA contributions is more restricted when filing separately.
6. Restrictions on Capital Loss Deductions – If you have investment losses, you can only deduct up to $1,500 per person when filing separately, compared to $3,000 for joint filers.
7. Marketplace Insurance subsidies – If one of the spouses qualifies for marketplace insurance and receives a subsidy, filing separately disallows this subsidy which will create a payback situation for the spouse with the insurance.  

When Should You File Separately?

Most married couples benefit from filing jointly, In some cases, filing separately makes sense. You might consider filing separately if:

• One spouse has high medical bills, state taxes, or other deductions that are easier to claim separately.
• The husband or wife owes past-due taxes, child support, or student loans, and you want to maximize your refund
• You are legally separated or in the process of divorce and want to keep finances separate.
• The two have significantly different incomes, and one of them can benefit from tax breaks the other doesn’t qualify for.

Which Filing Status Should You Choose?

Every couple’s situation is different. To decide what’s best for you, consider the following. 

1. Estimate Your Taxes Both Ways – A professional can help you weigh the differences to determine which option makes the most sense. 
2. Consider Your Credits and Deductions – If you’re eligible for big tax credits, filing jointly usually makes sense.
3. Think About Future Tax Liability – If your spouse has tax debt or errors, filing separately could protect you.
4. Consult a Tax Professional – Sometimes, the choice isn’t clear-cut. A tax expert can help analyze your situation and recommend the best option. Most tax programs contain an analyzer your tax preparer can run to show the differences between either filing options.

Need Help? Contact Flexkeeper for Tax Preparation!

Filing taxes can be confusing, but you don’t have to figure it out alone! At Flexkeeper, we help married couples choose the best filing option to save money and avoid mistakes.