Tax ramifications for married filing separate with 2 households

Suppose a couple work and live in 2 cities and got married while still maintain each household they own prior to the marriage and see each other on the weekends. Are they eligible to maintain their house as primary residence after marriage? Can they still file itemized deduction on each of their own expenses? What would be different for them to file separate comparing to filing as single? Will the lower tax bracket party be affected by the higher party?

Qtao,

You do not say if you are one half of this couple.
If you are, then Congratulations!

This married couple has 2 choices for filing their income tax. They can file Married Filing Jointly (MFJ), or Married Filing Separately (MFS). Usually MFJ will provide the lowest tax payment.

- Are they eligible to maintain their house as primary residence after marriage?
This couple can live where they want and maintain the 2 houses or as many houses as they can afford. However when they file MFJ, there is only one address that can be used.

- Can they still file itemized deduction on each of their own expenses?
When they file MFS, if one decides to use the itemized deductions on Schedule A they both must use that method even if one of them has no deductions. As for claiming a mortgage interest deduction, they could each take the deduction on their respective house. Or they both must use the Standard Dedution. Both filers must use the same deduction method, Standard or Itemized.

When they file MFJ, they can still claim itemized deductions on Schedule A. They can claim a deduction for the total interest paid on the mortgages for both houses. The IRS will allow us to deduct interest on our primary home and on a second home.

- What would be different for them to file separate comparing to filing as single?
Usually filing MFJ will provide a lower tax bill. Filing MFS several deductions and credits are not allowed. Student loan interest deduction, tuition and fees deduction, the education credits, and earned income tax credit are not allowed when filing MFS.

- Will the lower tax bracket party be affected by the higher party?
The best way to determine this is to get a copy of tax preparation software, and complete this filing MFJ. The software will have a calculator then to sort out each tax payer's amounts and show what the tax bill would be if you were to file MFS. Usually the MFJ filing will provide the lower tax payment vs the sum of the 2 MFS tax payments.

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