Hello Tax expert
Question 1
i own a house its fully under my name interest paid 22K and property tax 7k, in 2017
both of us made 75 k each total 150K
simple math
if i filed separate i can deduct around 40 k (including milage and charitable contribution) only from myself.
my wife can go for standard deduction /or itemized
We have a kid too.
In this scenarion married file separate or join which is best ? common thought married join is good but which sceanario married separate is good?

Question 2
First time i am trying to do my tax return myself turbo tax or credit karma which one is best?

Thanks in advance

I have always thought of taking a $300 course (or may be less) at Liberty Tax or HR Block or similar places after Tax season....where they teach you how to pass the exam and become a an IRS certified Tax Preparer - One time investment...valid for decades -as you can confidently file your own taxes every year afterwards (maybe)...... Please check some articles online if you don't get the answer you are looking for..



Togetherness or not?
Separate returns could produce tax savings if one spouse has a lot of medical expenses and a low income. By filing separately, the partner with the doctor bills might be more likely to exceed the 10 percent of adjusted gross income threshold needed to itemize medical costs. Taxpayers age 65 or older can still use the 7.5 percent threshold for their 2016 tax filing, but the 10 percent threshold applies to everyone in 2017. Only one spouse on a joint return must meet that age to get the lower deduction percentage.

Deduction flexibility also is sacrificed. If one spouse itemizes, both must itemize, splitting the items to be listed on a separate Schedule A for each. That means a partner with few deductions couldn’t use the standard amount and might get cheated when it comes to reducing taxable income.

Deduction, credit considerations
Many tax-cutting credits and deductions are forfeited when couples file separate 1040s. You can’t take the earned income tax credit, claim adoption expenses or child and dependent care costs, use educational tax credits or even deduct the interest you paid on a student loan if you’re married and filing separately. If you have children, you might find the child tax credit reduced because it phases out at different income limits for the various filing statuses. And the amount of capital losses you can deduct is cut in half."

https://www.bankrate.com/finance/taxes/filing-taxes-jointly-a-good-idea.aspx .

Thanks Regidk,
In 2015 i did file with nepali tax professional and received IRS penalty amount+interest I do not know IRS does license enforce or not , multiple tax preparation guys in town not sure How to trust them? They ask for cash and no receipt for the services too.. seems super complex process..

How are you deducting 40K when you are earning only 75K? Do you have your own business or are you working as independent contractor? Seriously 40K deduction in just mileage and charitable contribution is hell lot of money when you are just making 75K and IRS will probably audit you.
Since you are making 150K total as household income you are under 25% tax bracket which is good for you otherwise if you have gone up even 3K you would be under 28% tax bracket.
Anyway, you don't need to worry about these because turbo tax will give you a best advice. In my opinion except your HUGE deduction on mileage and charitable contribution, you will good with married filing jointly. Also I am confused how your wife can deduct when you already deducted 40K.
By the way as a financial advice, you are paying 22K interest paid that's extremely high

Sajha mitra,
22 K interest (mortage 3.75%APR 600K loan) and 7 k property tax( county)
5K charitable contribution,
i did change job 2 times , and job required lots of driving
75 k salary is in w2.(this year (2017) i did not not work full year)
You mentioned bracket 25 %, 28% may not be much different they do not apply percentage in all income i guess 10, 20, 25 in interval basis ,
correct me if i am wrong
I am learning tricks to save some money ......
Thanks for response.

Why dont you try filling in both ways and then see the difference, your tax situation doesnt look too complicated. Then file with whatever is the most beneficial.

submark, ok i understood. Didn't realize 40K includes your mortgage too. Good job on 5K charitable donation. Wish I can be you someday.
But I doubt you can deduct any mileage expense if you are working under w2.
Check this chart
https://www.thebalance.com/federal-income-tax-rates-4108244

Why would you file separate and more taxes. Remember if one spouse is claiming itemize deduction then the other spouse can't claim standard deduction. Plus the tax bracket changes in MFS as well. Claiming 40K deduction in 75k income will trigger AMT as well. I don't know what kind of job you do or travel you are referring too but claiming mileage in W2 income is a red flag. Normally employer reimburses all those mileage and cost of fuels.

I would suggest you file MFJ. And don't blame practitioner for your interest and penalties. You prolly didn't do your due diligence during the year.

Married filing joint is always the best option for the couples. With that kind of income, having a kid does make a whole lot of difference. You loose credit when you file separately. Your child tax credit, credit for dependent care expenses; they phase out as your income increases. Commute mileage is not deductible. Like other people said, if your company made you travel, more than likely they reimbursed you. Also if you itemize, then your wife will have to itemize. Does she have enough to itemize? Itemized deductions creates red flag. Besides the interest on mortgage payments and property taxes, make sure you have proper documentation for everything else you are trying to claim. It can get messy down the road.

i own a house its fully under my name interest paid 22K and property tax 7k, in 2017

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