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Subject Author Date
Tax Benefit for Marrired Couple Living Separately Victor Roberts 10-09-2007
Posted by Victor Roberts on October 9, 2007, 8:28 pm
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 My wife and I had dinner last Friday with a couple who
married after living alone in their own houses. They lived
only a few houses from each other and said it took over a
year to find a new house they both liked. During that time
they continued to live in their own homes and "commuted"
each day from one house to the other.

They said that this arrangement of having separate
residences gave them a $7000 Federal tax credit, which they
seemed to think was some benefit built into the system,
perhaps for separated couples.

I've never heard of any such deduction and am assuming that
they got a benefit from being allowed to deduct the mortgage
interest payments and real estate taxes for two primary
residences, something I assume they could not have done to
that extent if one was a vacation home and the other was
their primary residence.

Is this a correct understanding? If so, does the ability to
claim a deduction for interest and taxes for both residences
depend upon whether the couple filed MFJ, or MFS?

--
Vic Roberts
Replace xxx with vdr in e-mail address.

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Posted by Arthur Kamlet on October 10, 2007, 12:05 am
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> My wife and I had dinner last Friday with a couple who
> married after living alone in their own houses. They lived
> only a few houses from each other and said it took over a
> year to find a new house they both liked. During that time
> they continued to live in their own homes and "commuted"
> each day from one house to the other.
>
> They said that this arrangement of having separate
> residences gave them a $7000 Federal tax credit, which they
> seemed to think was some benefit built into the system,
> perhaps for separated couples.
>
> I've never heard of any such deduction and am assuming that
> they got a benefit from being allowed to deduct the mortgage
> interest payments and real estate taxes for two primary
> residences, something I assume they could not have done to
> that extent if one was a vacation home and the other was
> their primary residence.
>
> Is this a correct understanding? If so, does the ability to
> claim a deduction for interest and taxes for both residences
> depend upon whether the couple filed MFJ, or MFS?

As an Ohio tax preparer, I get to prepare many many MFS
returns in order to save on tax.

Most of the savings are from the Oio incometax returns, but
there are certainly situations where MFS saves on the
federal return. A few quick examples that come to mind:

1) Any of the AGI limiting deductions are not so limited
when lowering AGI by filing MFS. These include Sch A
Medical, Miscllaneous and casualty loss.

2) To a degree, the amount of Social security that is taxed
can be reduced when filing MFS and not living together.

3. Couples claiming child tax credit could be above the
child tax credit cutoff but at least one could come in under
when filing MFS.

4. Is the $1million of principal for mortgage interest cut
in half when filing MFS? I don't remember. If not, then
an advantage here.

--
ArtKamlet at a o l dot c o m Columbus OH K2PZH

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Victor Roberts on October 11, 2007, 12:41 am
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Kamlet@panix.com (Arthur Kamlet) wrote:

[snip]

>> Is this a correct understanding? If so, does the ability to
>> claim a deduction for interest and taxes for both residences
>> depend upon whether the couple filed MFJ, or MFS?

> As an Ohio tax preparer, I get to prepare many many MFS
> returns in order to save on tax.

[snip]

Thanks for the info, but I was asking about a tax deduction
specifically tied to two residences for married people each
owning their own homes.

--
Vic Roberts
Replace xxx with vdr in e-mail address.

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by Don Priebe on October 11, 2007, 12:41 am
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> My wife and I had dinner last Friday with a couple who
> married after living alone in their own houses. They lived
> only a few houses from each other and said it took over a
> year to find a new house they both liked. During that time
> they continued to live in their own homes and "commuted"
> each day from one house to the other.
>
> They said that this arrangement of having separate
> residences gave them a $7000 Federal tax credit, which they
> seemed to think was some benefit built into the system,
> perhaps for separated couples.
>
> I've never heard of any such deduction and am assuming that
> they got a benefit from being allowed to deduct the mortgage
> interest payments and real estate taxes for two primary
> residences, something I assume they could not have done to
> that extent if one was a vacation home and the other was
> their primary residence.

It's not the mortgage or RE taxes - you can deduct interest
on two houses and taxes on an unlimited number of
properties.

Are any children involved? Maybe they are both filing HoH
with EIC, the same as they did before they were married.
That could easily be $7,000 better than MFJ.

--
Don EA in Upstate NY

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

Posted by pleasedontemailme on October 11, 2007, 10:20 pm
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>> My wife and I had dinner last Friday with a couple who
>> married after living alone in their own houses. They lived
>> only a few houses from each other and said it took over a
>> year to find a new house they both liked. During that time
>> they continued to live in their own homes and "commuted"
>> each day from one house to the other.
>>
>> They said that this arrangement of having separate
>> residences gave them a $7000 Federal tax credit, which they
>> seemed to think was some benefit built into the system,
>> perhaps for separated couples.
>>
>> I've never heard of any such deduction and am assuming that
>> they got a benefit from being allowed to deduct the mortgage
>> interest payments and real estate taxes for two primary
>> residences, something I assume they could not have done to
>> that extent if one was a vacation home and the other was
>> their primary residence.

> It's not the mortgage or RE taxes - you can deduct interest
> on two houses and taxes on an unlimited number of
> properties.
>
> Are any children involved? Maybe they are both filing HoH
> with EIC, the same as they did before they were married.
> That could easily be $7,000 better than MFJ.

EIC is not permitted on a filing status of MFS.

-Crystal

<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>

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