Married Filing Jointly vs. Separately: Which Is Better in Texas?
Most married couples pay less tax filing jointly, but not all. And because Texas is a community property state, filing separately here works differently than in most of the country. Here's how to decide.
By the Enrolled Agents and CPAs at A&W Tax Services · Updated
Why most couples file jointly
Filing jointly gives you the widest tax brackets and the largest standard deduction, and it keeps credits that married-filing-separately returns lose or limit, such as education credits, the credit for child and dependent care, and in most cases the Earned Income Tax Credit. The student loan interest deduction isn't allowed on a separate return either.
When filing separately can make sense
- You're on an income-driven student loan repayment plan that counts only your own income when you file separately
- You don't want to be responsible for your spouse's tax: on a joint return, both spouses are liable for the whole tax
- You're separated or in the middle of a divorce
- One spouse has large medical expenses, which are deductible only above a percentage of income
- Your spouse owes back taxes or child support and you want to protect your share of a refund
The Texas twist: community property
Texas is one of nine community property states. If you file separately, income earned by either spouse during the marriage, such as wages, is generally split 50/50 between you, and each spouse reports half. Income from separate property can also be community income in Texas. You attach Form 8958 to show how income and withholding were divided.
That means filing separately in Texas often doesn't separate your income the way couples expect, which affects student loan plans and other calculations. It pays to run the numbers both ways.
Other rules to know
- If one spouse itemizes on a separate return, the other must itemize too, even if their deductions are small
- You can switch from separate returns to a joint return by amending within three years, but generally not the other way after the due date
- If you're married but lived apart for the last six months of the year and support a child at home, you may qualify as head of household instead
- Relief from joint liability, such as innocent spouse relief, is available in some cases