Why Married Filing Jointly Is Almost Always the Better Choice (and the Rare Times it Isn’t)

Why Married Filing Jointly Is Almost Always the Better Choice (and the Rare Times It Isn’t)

When couples get married, one of the first tax questions that comes up is how to file. While there are two options available, Married Filing Jointly and Married Filing Separately, the reality is that filing jointly is almost always the better financial move. In our experience working with families in Green Bay and De Pere, joint filing wins out in the vast majority of situations.

The biggest reason Married Filing Jointly usually makes sense is access to better tax rates. The tax brackets for joint filers are wider, which often means more income is taxed at lower rates. When spouses file separately, those brackets are cut roughly in half, pushing income into higher tax rates more quickly. For most households, this alone creates a noticeable difference in total tax owed.

Another major advantage is eligibility for key tax credits and deductions. Married couples who file jointly can qualify for the Child Tax Credit, education credits like the American Opportunity Credit, and deductions related to student loan interest. Many of these benefits are either reduced or completely unavailable when filing separately. For families with children or ongoing education expenses, this can be thousands of dollars left on the table.

Joint filing also tends to simplify the entire tax process. Combining income, deductions, and credits into one return generally reduces errors and makes planning easier. From a practical standpoint, it also lowers professional fees and reduces the administrative headache during tax prep. One coordinated return is usually far easier than managing two separate ones, especially when income or assets overlap.

That said, there are rare situations where Married Filing Separately can make sense. One of the most common involves income-driven student loan repayment plans. In some cases, filing separately can reduce the calculated household income used to determine monthly payments. However, this benefit needs to be weighed carefully against the loss of tax credits and higher tax rates. Often, the tax cost outweighs the loan savings, but not always.

Another scenario involves significant medical expenses. Since medical deductions are limited to amounts exceeding a percentage of adjusted gross income, separating incomes can occasionally allow one spouse to deduct more expenses. This tends to apply only in very specific circumstances and usually requires careful calculation to confirm it actually helps.

There are also situations involving liability or compliance concerns. If one spouse has serious tax issues, unreported income, or questionable filings from prior years, filing separately may be a short-term risk management decision. This is less about saving money and more about protecting the other spouse from joint responsibility. Even then, this is usually a temporary strategy rather than a long-term solution.

For most married couples, especially dual-income households or families with children, the math overwhelmingly favors filing jointly. In our work with clients across Green Bay and De Pere, it’s rare to see a case where separate filing produces a better overall outcome once all factors are considered.

The key takeaway is that this decision should never be made automatically or based on advice meant for someone else’s situation. Good tax prep involves running the numbers both ways and understanding the trade-offs. While Married Filing Jointly is almost always the right answer, the exceptions are real, just uncommon.

If you’re unsure which option is best for your situation, a quick comparison during tax prep can provide clarity and peace of mind. Making the right filing choice can have a meaningful impact on your tax bill, both now and in the years ahead.