Owner occupancy duplex and tax question

[Jon A.]

I have recently separated from my marriage partner and moved into a duplex that I purchased before marriage. This has all happened within the last 30 days. We have a HELOC that we qualified for together back in 2020 that I pulled the money out of and put into a saving account for fear of them cutting the line of credit. I have the money and can pay it back but then I wouldn't have any cash reserved. We would both like her off of the HELOC so I am considering just paying it back and refinancing the property to have some reserves moving forward. I will obviously be losing some income as I am now living in half of the duplex.

The state of NC requires that we be separated for one year before a divorce can be final. Therefore, we will still be married for the tax year of 2024.

Going forward this year I am not sure if we should file our taxes "married but jointly" or married but separately" for the tax year of 2023. I am concerned that if we file jointly I will not be able to refinance in my own name, but I am also concerned about the tax burden if we file "married but separately". Any insight is greatly appreciated. Thanks in advance.