File married jointly or separate?

[Ben Kirchner]

My wife and I keep our financial accounts seperate, and simply share a mutual credit card that we equally contribute to for mutual expenses (mostly groceries).  I purchased 2 houses with my own finances in 2017, which are completely in my name.  Would we be best off filing separate?

My wife and I got married in 2016.  She had $0 taxable income in 2016, but now has a full year of taxable income in 2017.  I will also note that my wife and I are purchasing future investment properties together, starting 2018.  

Would I be best off filing as separate?  Any advantages for filing jointly?

Thank you

[Paul Allen]

Filing separately reduces or eliminates eligibility for several adjustments, deductions, and credits and frequently results in a higher amount of tax being owed. Filing separately can adversely impact the following tax benefits:

1. In most cases you cannot claim the credit for Child and Dependent Care Expenses.
2. You cannot claim the Earned Income Credit.
3. You cannot claim any education credits.
4. You cannot claim the adjustment for Student Loan Interest.
5. You cannot claim the exemption for interest on EE bonds used for education.
6. Your Child Tax Credit is half what it would be on a joint return.
7. Your Capital Loss limit is cut in half.
8. Your Saver's Credit is cut in half.
9. You cannot claim passive losses on real estate rental property (if you still live with spouse)
10. Your Alternative Minimum Tax Exemption is cut in half.
11. Your standard deduction is cut in half.
12. If your spouse itemizes you can't take the standard deduction at all.
13. You expose more Social Security to being taxed.
14. You cannot claim the adoption credit, and if you received adoption benefits from your employer they are now taxable.
15. Not really a tax benefit, but if you file separately your tax preparer will charge you for preparing two returns. Jointly, just one.