Читать книгу Taxation of Canadians in America - David Levine - Страница 14

There are five filing statuses in the US; single, married filing jointly, married filing separately, head of household, and qualifying widow or widower. In Canada, couples file their own separate returns, in the US married couples can, and typically do, file a joint return where both spouses report all of their income and deductions on a single return. Married couples may choose to file separately, but not as singles.

Note: As of this writing, six states recognized same-sex marriages. Marriage licenses are granted by these six states: Connecticut, Iowa, Massachusetts, New Hampshire, New York, and Vermont, plus Washington, DC and Oregon’s Coquille and Washington’s Suquamish Indian tribes. Common-law marriages are allowed in the following states plus the District of Columbia: Alabama, Colorado, Iowa, Kansas, Montana, New Hampshire, Oklahoma, Rhode Island, South Carolina, Texas, and Utah. As mentioned previously, the IRS will recognize common-law marriages, and will allow the couple to file as married filing jointly. In addition to the states listed, couples from other countries that recognize common-law marriages, such as Canada, will also be recognized by the IRS.

While it is usually beneficial for married couples to file jointly, there can be circumstances where filing separately might be beneficial. The most common situation in which a couple might consider filing separately is when one spouse has many more deductible expenses than the other spouse, such as medical expenses where the deduction is limited to the amount that exceeds 7.5 percent of income.

For example, assume in this very simplistic example that Jane has income of $100,000 and her husband Bob has income of $30,000. Bob also had $10,000 of medical expenses, whereas Jane had no medical expenses. If Jane and Bob were to file jointly, they would have $130,000 of income and their medical expenses would be limited to $250, the amount above 7.5 percent of $130,000 (130,000 x 7.5% = 9,750). In other words, the first $9,750 would not be deductible. On the other hand, if they filed separately, Bob would be allowed to deduct $7,750, as only $2,250 would not be allowed (30,000 x 7.5% = 2,250).