A Deep Look into Filing Joint Tax Returns in Northbrook
Article Body: If you are a couple, there is always that option to have your income tax returns be filed jointly. In North Brook, the joint return is infact mostly recommended. However, it is now always the case, there are some instances that have happened in Northbrook where the couples that is married file the returns separately. Having a deep look into the advantages and disadvantages of the two instances will help to choose the best option as far as income tax returns is concerned.
What are the advantages of filing joint tax returns?
Believe me you, there comes alot of advantages if you decide to file joint tax returns with your spouse. In Northbrook, the governing body gives those who are filing jointly one large deduction that is standard annually. Doing so allows them to have a significant amount deducted from their income.
The couple will also enjoy some exceptional amount deduction from their total income and they are eligible to several tax credits: the child and dependent care tax credit, earned income tax credit, getting credit or being excluded for the adoption expenses, lifetime education tax credits among others.
The couple will also be able to enjoy certain tax breaks even if they earn a large amount income. It is for these reasons that filing joint tax returns is recommended not only in Northbrook but to most parts of the world.
What are some of the consequences of filing tax returns separately?
There are always very few tax considerations to the couples who decide to file the returns separately. This always lead to higher taxes that are characterized with higher tax rates. Statistics show that last year the spouses who filled returns separately received a deduction amounting to $6200 while the joint one had a $12400 standard deduction.
Individual taxpayers will also be subjected to smaller IRA contribution deductions which arein most cases limited. Fees or tuition deduction are the other credits that those who file separately wont enjoy. I most cases, you will find that there is a reduction in the child tax credit since it incurs several income limits that depends on the filing statuses. Filing the tax returns separately will attract a $1500 total capital loss deduction and $3000 to those doing it jointly in Northbrook.
What are the instances where filing separately is recommended?
Even though they are always rare instances, filing returns separately may help you to save on the total tax you remit. When your spouse or you have larger medical expenses that are out of the pocket to be claimed, it becomes challenging to claim the expenses more so if your partner or you have the AGI that is higher. Since the law allows to have a deduction on the costs above 10% of your AGI, separate filing of the returns will help you claim your total medical deductions. This is done through application of 10% only on your total income.
In most cases when the marriage is not effective i.e. on the rocks, lots of couples do decide to start filling the tax returns separately even before the divorce is officially done. This is because they try to avoid being tied to their partners based on tax returns filing.
It is advisable that you figure out your total taxes using the two methods so as to find which one will result to a lower tax bill. However, you will find that filing the tax returns jointly will be lower. Contact us to make this happen for you.