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Louis2 · Jan 27, 2012, 09:34 AM

I work and live with a dependent in NJ, My wife works and lives with a dependent in CA. Each doesn't have income from other state. Can my wife and I file head of household separately?

ebaines · Jan 27, 2012, 10:00 AM

No - Head of Household is only for unmarried individuals. You MUST file as either Married Filing Separately (MFS) or Married Filing Jointly (MFJ). For your federal return you most likely come out ahead filing as MFJ, but it doesn't hurt to run the numbers using MFS to see how it works out.

For NJ you can file as MFS even if you filed jointly on your federal return, as long as your wife was not a resident of NJ at any time during the year and has no NJ-source income. Similar rules for her to file in CA - if you have no CA source income and were not a resident she can file as MFS in CA. This way you each pay taxes to your state of residence but not to the other's state.

Louis2 · Jan 27, 2012, 12:19 PM

Are we considered unmarried?

ebaines · Jan 27, 2012, 12:26 PM

Originally Posted by Louis2

Are we considered unmarried?

If you are legally married and not legally separated - then you are married. You did refer to her as your "wife," so it seems pretty clear that you are married.

AtlantaTaxExpert · Jan 29, 2012, 12:19 AM

ebaines:

I have to disagree with your analysis.

I believe Louis2 is speaking about the provision for Head of Household as specified in pages 23-24 in IRS Pub 17. If they lived apart for the last six months of the year, it seems to me that they BOTH qualify for Head of Household.

ebaines · Jan 30, 2012, 07:12 AM

ATI: I defer to your experience on this one, as long as each spouse can show that s/he provided at least half the cost of upkeep for their respective home. I've always thought of the "considered unmarried" provision as a way for people who are still married but have split and are no longer living together to file as HoH. But if the couple continues to have traditional financial arrangements for married couples such as joint accounts (checking or otherwise) it can be difficult to prove which person is paying for upkeep of which home.

AtlantaTaxExpert · Jan 30, 2012, 08:13 AM

ebaines:

I believe I am correct on this issue, but your point about joint checking accounts is well taken, because, as we both know (but perhaps Louis2 does not), if the IRS challenges the validity of the returns, the burden of proof rests with the taxpayer.

Louis2:

On the presumption that you and your spouse have been living apart for the last six months of the year, you can each file Head of Household. If you have not already doing so, establish separate checking accounts and separate credit cards to manage the finances of each household in case the IRS comes calling.