When Married Filing Separately is the Right Answer

“Married filing separately” is frequently overlooked as a tax filing status due to the rule of thumb that filing jointly tends to result in a lower tax liability. But filing separately unlocks numerous financial planning opportunities (and sometimes significant tax savings!) which are frequently overlooked by clients’ tax preparers. In this session, I will explore the benefits and limitations of filing separately for married couples in order to provide a better framework for advisors to assist their clients and their tax preparers with this critical decision.

Learning Objectives:

• Identify client profiles where filing separately maximizes savings, such as for those with income-driven student loan repayment, state marriage penalties, or income tax credit arbitrage.
• Understand the impact of Married Filing Separately status on Medicare premiums, tax credits, deductions, and considerations for community property states.
• Collaborate with tax preparers to analyze filing status and identify opportunities for amending past returns.