Check out some similar questions!

jacknginger · Apr 8, 2013, 04:41 PM

My wife and I both lived/worked in New Jersey till August 2012 and then she had to move to Ohio in September of 2012 to start a new job. I am still working/living in NJ.

In terms of income, we only have W2s : I have one W2 from my NJ employer and my wife has two W2s, one from her previous employer in NJ and one from her current employer in OH. We do not have any investment income, no property taxes (renting), do dependents (kids) and so will be using standard deductions for our tax returns and not itemizing.

What would be the best approach in filing our 2012 tax returns?

1) For federal, can we file Married filing jointly? Even though I have an NJ address and she officially has an OH address?

2) For the states... Can I file as Married filing single for NJ with just my W2 and can she file Married filing single for NJ partial and Married filing single for OH? My confusion is that our federal status would be different from the states and so I am wondering if the states of OH and NJ allow that?

I appreciate you time, thanks.

ebaines · Apr 9, 2013, 06:13 AM

It's a bit complicated...

1. You can file as Married Filing Jointly for your federal return, no problem.
2. For NJ you must use the same filing status as for your federal return (although there's an exception to this rule that I'll get to later). So for 2012 I suggest you file a regular full-year resident return, file as MFJ, report all income including income from Ohio, and take a credit for income tax your wife pays to Ohio. This credit for taxes paid to other jurisdictions is what prevents being taxed by two states on the same income. Then next year, if your wife continues to live and work in OH and has no NJ-based income you can file as Married Filing Separately (MFS) in NJ - this is the one exception, which applies only to married couples where one lived outside of NJ for the entire year. See http://www.state.nj.us/treasury/taxa...gi-ee/git6.pdf for details.
3. For OH you must file jointly. I suggest that for 2012 you file a non-resident return. You will report all joint income, but are taxed only on the portion your wife earned working in OH. Then next year your wife can file as a full-year resident of OH with filing status MFS - again using the exception to the general rule that requires filing with the same status as on your federal return.

Like I said, it's complicated. Hope this helps.

AtlantaTaxExpert · Apr 9, 2013, 07:03 AM

Excellent answer, ebaines. Concise,and well explained!

ebaines · Apr 9, 2013, 07:30 AM

Thanks ATE!

jacknginger · Apr 9, 2013, 10:13 AM

@ebaines, thank you very much for that detailed explanation.
Also, I am guessing the less complicated way would be for the two of us to file as Married filing single for both federal / state? That would probably result in a smaller return amount though.

ebaines · Apr 9, 2013, 10:16 AM

Right - for most couples the taxes you would owe filing MFS are greater than MFJ, so you want to avoid that if possible.

jacknginger · Apr 14, 2013, 10:05 PM

Funny thing is that I have compared MFJ and MFS scenarios for the two of us (for both fed/state(s)) and it turns out that we will actually be getting more back with MFS. I am using turbo tax online and the federal returns are about the same (slightly more with MFJ). The difference is with MFS for Ohio, where we (or my wife) ends up getting more by filing MFS with OH than MFJ.

AtlantaTaxExpert · Apr 14, 2013, 10:13 PM

Yes, that happens occasionally, and is the exception that proves the rule.