Married couples can choose between two filing statuses when submitting their 2025 federal income tax returns: married filing jointly or married filing separately. This decision affects your standard deduction, eligibility for certain tax benefits, tax brackets, and overall tax liability. The better option depends on your specific circumstances.
In most cases, you should select the filing status that results in the lowest overall tax. Typically, married filing jointly produces a lower tax bill than filing separately. This is especially true when spouses have different income levels. Combining incomes can shift a portion of the higher-earning spouse’s income into a lower tax bracket.
TAX BREAKS AVAILABLE TO JOINT FILERS
Beyond favorable tax brackets, certain tax benefits are unavailable to married couples who file separately. Examples of tax breaks generally available only to joint filers include:
- Child and dependent care credit
- Adoption expense credit
- American Opportunity credit
- Lifetime Learning credit
- Exclusion of employer-provided adoption assistance
- Exclusion of interest income from Series EE or Series I savings bonds used for higher education
- Deduction of IRA contributions when covered by an employer-sponsored retirement plan, such as a 401(k)
- Qualified tips deduction
- Qualified overtime deduction
- Senior deduction
SITUATIONS WHERE FILING SEPARATELY MAY MAKE SENSE
Although filing jointly is usually more advantageous, there are circumstances where filing separately may reduce overall tax or provide other benefits, such as:
- Significant medical expenses for one spouse
- Medical expenses are deductible only to the extent they exceed 7.5 percent of adjusted gross income (AGI). Filing separately may allow the spouse with high medical expenses to exceed this threshold more easily due to a lower individual AGI.
- Income-driven student loan repayment plans
- Reporting a lower income on a separate return may reduce monthly loan payments.
- Liability concerns
- When spouses file a joint return, they are jointly and severally liable for the tax on their combined income. Each spouse is equally responsible for any additional tax, interest, and most penalties assessed by the IRS. This means the IRS may collect the full amount from either spouse. Although “innocent spouse relief” may be available in limited situations, it has restrictions. As a result, some individuals choose to file separately, even if it results in higher tax, to remain responsible only for their own tax liability. This is more common when spouses are separated.
COUPLES MARRIED IN 2025
If you were married at any point during 2025, the IRS considers you married for the entire year. You must file either jointly or separately. Married filing separately is not the same as filing as single, and the tax results may differ significantly from what each spouse experienced when filing single in 2024.
While the standard deduction and lower and middle tax brackets are the same for single filers and separate filers, higher tax thresholds are less favorable for married filing separately. The 37 percent top tax rate, the 20 percent long-term capital gains rate, the 3.8 percent net investment income tax, and the 0.9 percent additional Medicare tax all apply at lower income levels for separate filers. In addition, exposure to the alternative minimum tax may be higher.
MANY FACTORS TO CONSIDER
These are only some of the considerations involved in choosing between joint and separate filing. Contact us to discuss how these and other factors may affect your specific tax situation.
