Sunday, January 17, 2010

If my husband and I file married but filing seperatly, and we live together what are the penalties?

I just found out that my husband and I owe 1650 fed and 400 state for next year. If we filed married but separate, will we still have to owe, or will we owe more? And if we did file married but seperate and we are living together, will we go to jail? This may seem like a really dumb question, but I have no clue. Ok thank you!If my husband and I file married but filing seperatly, and we live together what are the penalties?
You can always choose ';Married-Filing Separately'; even if you live together but, usually, you will end up worse off tax wise than if you filed a Joint return.If my husband and I file married but filing seperatly, and we live together what are the penalties?
Whether you file jointly or separate is your own choice. Sometimes it makes a difference in tax rates etc, but not a lot. Next year, you can buy some tax software (Quicktax is what I use but they are all about the same) and try it both ways to see what the benefit is one way or the other.
Run the numbers to see how it works out for you. You will not go to jail for owing just over $2000 in tax. The IRS and the state revenue department just want their money. If you can't afford to pay it all at once, they will work with you to set up a payment plan. However, it may be cheaper to get a loan to pay the back taxes. Again, run the numbers.
I dont know about the jail thing but your tax rate will be higher so most likely you will owe more.

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