Married Filing Separately

Married Filing Separately — What it Is and When to Use It

Key takeaways
* Married filing separately (MFS) is a filing status where each spouse files their own federal tax return, reporting only their individual income, exemptions, and deductions.
* MFS can help when one spouse has large deductible expenses (for example, medical costs) or when spouses want to keep tax liability separate.
* Filing separately often means losing access to certain tax credits and deductions available to joint filers and can result in higher taxes in many situations.

What is Married Filing Separately?

Married filing separately (MFS) is a tax filing status for couples who are legally married but choose to file separate federal tax returns. Each spouse reports their own income, exemptions, and deductions on their individual return rather than combining finances on a joint return.

How it works

• Eligibility: You must be married as of the last day of the tax year to choose MFS.
• Reporting: Each spouse reports only their own income and deductions, but some rules require coordination—for example, if one spouse itemizes deductions, the other generally must also itemize and cannot take the standard deduction.
• Tax brackets and rates: Filing separately can change your effective tax rate and the phaseout thresholds for certain benefits. In many cases, filing jointly produces lower overall tax, but exceptions exist.

Common reasons to choose MFS

• One spouse has large medical expenses, miscellaneous itemized deductions, or unreimbursed business expenses that are deductible only above a percentage of adjusted gross income (AGI). Separating incomes can make those thresholds easier to meet.
• Concern about joint liability — filing separately shields you from being legally responsible for your spouse’s tax errors, underreported income, or fraud (subject to exceptions).
• Personal or financial privacy between spouses.

Special considerations

• Community property states: In community property states (where marital income is treated as jointly owned under state law), income and deduction allocation can be more complicated when filing separately. Consult a tax professional if you live in such a state.
• Interaction with credits and deductions: Many tax benefits either phase out more quickly or are unavailable to separate filers (see next section).
• Standard deduction: If one spouse itemizes, the other generally cannot claim the standard deduction and must itemize as well.

Filing separately vs. filing jointly — what you may lose

Filing separately can disqualify you from or limit these tax benefits:
* Earned Income Tax Credit (EITC)
* Child and Dependent Care Credit (may be reduced or unavailable)
* Education credits such as the American Opportunity Tax Credit and Lifetime Learning Credit (limits differ)
* Certain tax breaks for IRA deductions if one spouse is covered by a retirement plan at work (income limits are lower for separate filers)
* Adoption credit (often not available when filing separately)
Because of these limits, married filing jointly often yields greater tax savings when spouses’ incomes differ significantly.

Drawbacks

• Higher combined tax liability is common because separate filers often face less favorable brackets, phaseouts, and credit eligibility.
• More complex recordkeeping if you must coordinate deductions and credits.
• Potential inability to use the standard deduction if your spouse itemizes.

Frequently asked questions

Q: Do I need to report my spouse’s income when filing separately?
A: Generally no—each spouse reports only their own income—except in community property states, where income may need to be split according to state rules.

Q: Can we file jointly one year and separately the next?
A: Yes. Couples can choose filing status each tax year; married couples may file jointly one year and separately in subsequent years.

Q: When is MFS the better choice?
A: MFS can be beneficial when one spouse has large itemized deductions that exceed the standard deduction threshold when measured against that spouse’s lower AGI, or when one spouse wants to avoid joint liability for tax issues. Always compare the projected tax under both scenarios before deciding.

Bottom line

Married filing separately is a useful option in specific circumstances—notably when protecting oneself from joint liability or when one spouse has unusually large deductible expenses. For most couples, filing jointly provides the greater tax advantage because of broader access to credits and more favorable tax treatment. Calculate your taxes both ways or consult a tax professional to determine the best filing status for your situation.