Wealth Insights

Should married couples file taxes jointly or separately?

Tax planning for couples can add complexity to an already complicated process.

There are many decisions that were once made individually that take on greater complexities for married couples.

“Deciding whether to file taxes jointly or separately is an important decision that can significantly impact a couple’s tax liability and overall financial picture,” says Mai Ong, Trust Advisor at Regions Bank in Clearwater, Florida.

Filing jointly often means higher income thresholds for tax brackets, eligibility for certain credits and deductions, and potentially a lower tax bill overall. On the flip side, filing separately can be beneficial under certain circumstances. Evaluating both options requires consideration of individual financial circumstances and engaging a tax professional can be beneficial.

Tax considerations: Let's assume that filing jointly is preferred

For most couples, filing jointly tends to be the most financially advantageous approach. “The majority of couples will benefit more by filing married jointly,” says Ong.

For one, it’s just simpler to file one return rather than two, but also because there is no additional financial advantage to claiming two individual standard deductions allowed by the Internal Revenue Service (IRS) which automatically decreases your taxable income without itemizing specific deductions—rather than the single deduction for married couples filing jointly. For example, for the 2024 tax year married couples filing jointly can claim a standard deduction of $29,200, which is exactly the same deduction two spouses filing separately can claim.

As a married couple filing jointly, you also are eligible to claim tax deductions that are not available to spouses filing individual returns. For example, joint filers can seek tax credits not available to couples filing separately, including the Earned Income Tax Credit, the Child and Dependent Care Tax Credit and the American Opportunity and Lifetime Learning Education Tax Credits.

“There are generally fewer tax benefits to filing separately,” notes Ong. “That includes being limited to a smaller IRA contribution deduction, the loss of eligibility to take a deduction for student loan interest and the capital loss deduction limit which is limited to $1,500 versus $3,000 when it’s a married joint tax return,” says Ong.

Tax considerations for couples: The case for filing separately

There are circumstances when it can be financially advantageous for married couples to file separately. This is primarily the case if you’re planning to itemize deductions rather than claim the standard deduction.

Keep in mind that married couples filing separately both must file using the same method. In other words, if one spouse itemizes their deductions, the other spouse must as well, even if they aren’t submitting a joint tax return.

Tax considerations for couples #1: IRS debt

One frequent reason comes when one spouse enters the marriage carrying a debt to repay to the IRS. If you are married and decide to file jointly, that means the spouse who didn’t owe the IRS will instantly take on that liability—a debt they may prefer not to take on. For couples about to get married, transparency into existing debts establishes a strong foundation for financial communication throughout the marriage.

Tax considerations for couples #2: High medical expenses

Reason number two to file separately is the scenario when one spouse has high medical expenses. The IRS allows for the deduction of medical and dental expenses if they exceed 7.5% of your adjusted gross income. If one spouse has a relatively low income and high medical expenses, it may make sense to file separately. “Filing separately, a spouse may benefit by claiming the medical expenses versus if they file jointly and losing eligibility to claim the expenses due to exceeding the threshold due to a higher joint income,” says Ong.

Tax considerations for couples #3: Student loans

A third reason to file separate returns: Better student loan repayment management. Some student loan repayments are based on income. Couples may want to keep those monthly debt repayments as low as possible, filing separately can help.

Tax considerations for couples #4: Personal preference

Some couples also see value in keeping their finances separate.

It’s not a matter of anticipating a demise of the relationship, but about maintaining independence and flexibility around spending, saving, and investing while working together to reach shared financial goals. When that is the objective, filing separately is a potentially attractive option.

Two things to do

1. Review our comprehensive tax checklist to ensure you are prepared for filing.
2. Learn how to make discussions about finances easier with these tips for planning a money-talk date night.