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Tax Newsletter

Itemized Deductions on Married Filing Separately Tax Returns

When filing your federal tax return, you usually have the option of taking the standard deduction or itemizing your deductions to adjust your taxable income. However, if you are married but filing separate tax returns and choose to itemize deductions, then your spouse will not qualify for the standard deduction. In order to claim allowable deductions, your spouse should also itemize his/her deductions.

If you file a separate return, you may be able to claim the following deductions regardless of whether you paid expenses separately or jointly.

Medical Expenses

If you paid for medical expenses with funds deposited in a joint checking account, you can deduct half of the total medical expenses on your separate return, unless you can show that you alone paid the expenses.

State Income Tax Returns

If you filed your state return separately, you can deduct the amount you paid for yourself

If you filed a state return jointly and are jointly and individually liable for the full amount, you can deduct the amount you paid for yourself

If you filed a state return jointly and are only liable for your own share of state income tax, you can deduct the smaller of:

  • The state income tax you paid during the year
  • The amount that is proportionate to your gross income compared to the combined gross income of you and your spouse

Property Tax

If you paid taxes on property owned jointly by you and your spouse in a “tenancy by the entirety” ownership, you can deduct the amount of property tax that you alone paid. (A tenancy by the entirety is a form a joint ownership of real estate, only applicable in some states).

Mortgage Interest

In community property states, you and your spouse may each take an equal deduction of one-half the mortgage interest you paid. In other states, you may be able to split the deduction any way you want. In that case, it may make more sense to give more of the deduction to the higher-earning spouse to reduce his or her adjusted gross income (the amount on which taxes are paid).

Casualty Loss

If you have a casualty loss on a home you own as tenants by the entirety, you can deduct half of the loss, but neither spouse may report the total casualty loss.

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