Should you file taxes jointly if you’re married, or separately? In most cases, file jointly.

• Filing taxes jointly results in savings for most married couples.
• Joint filers get double the standard deduction and have full access to valuable deductions and credits.
• But it can make more sense to file separately in a few cases, such as when you have excessive medical expenses.
• See Personal Finance Insider’s picks for the best tax software »

Most people can agree on one thing when it comes to money: They hate losing it.

For married couples, choosing to file taxes jointly or separately can have a significant impact on the amount of income tax owed.

In the vast majority of cases, couples save money by filing jointly — especially if one spouse works and the other doesn’t, one spouse out-earns the other significantly, or they have children. Still, there are special circumstances where it makes sense to file separately. The right filing status for you will depend on your expenses and income.

If you got married on or before December 31, you’re considered married for the entire year for tax purposes.

Should I file taxes jointly or separately with my spouse?

Every couple’s situation is different, but in general there are a few major benefits to married filing jointly (MFJ):

• Access to valuable tax deductions and credits, including the earned income tax credit, child and dependent care credit, the American Opportunity credit, the Lifetime Learning credit, student-loan interest deduction, the maximum state and local tax (SALT) deduction, and the full IRA deduction (up to the income limits).
• Combining incomes could bring a higher earner into a lower tax bracket, since the tax rate ranges for married filers are different than single filers.
• A standard deduction of $25,100, reducing taxable income by the maximum amount.
• A maximum capital loss deduction of $3,000.

Here are some key points to consider about married filing separately (MFS):

• Excluded from earned income tax credit, child and dependent care credit, the American Opportunity credit, the Lifetime Learning credit, student-loan interest deduction, and the adoption credit, and unable to qualify for a full IRA contribution deduction.
• If one spouse chooses to itemize their deductions, the other must, too.
• State and local income tax (SALT) deductions are limited to a total of $5,000, half the amount available to joint filers.
• The income threshold for the highest tax rate comes much sooner for MFS than for MFJ and single filers.

When to consider filing taxes separately

Filing separately does save some couples money. One of the primary reasons couples choose to file separately is if a spouse claims itemized deductions that would exceed the amount of their standard deduction, like business expenses, charitable donations, or medical bills.

Note that both spouses must take the same approach to taxes: If one spouse itemizes, the other must, too. Or, if one spouse takes the standard deduction, the other must do the same. The IRS does not allow one spouse to itemize and the other to take the standard deduction.

Your medical expenses are very high

For the 2020 tax year, filers can begin to deduct medical expenses once the total amount exceeds 7.5% of their adjusted gross income (AGI). When spouses’ incomes are combined, the threshold can be exceptionally hard to meet. Further, it’s usually not worth doing unless the deductible amount is higher than the standard deduction ($25,100) for married couples who file jointly.

Filing separately would allow both spouses to begin deducting qualified medical expenses after they exceed 7.5% of their own AGI. Remember, though, that itemizing deductions will disable either spouse from claiming their separate standard deduction (half of the amount you would get filing jointly).

A spouse is on an income-driven repayment plan for student loans

Another reason to consider filing separately is if one spouse (or both) uses an income-driven repayment plan for federal student loans. When you file jointly, your combined income is recognized as the borrower’s income, since the AGI listed on your annual tax return is the figure used to represent income. A higher combined AGI could significantly drive up monthly payments for the individual borrower.

You want to protect your own finances or need to follow state law

Lastly, not to plant the seeds of doubt, but filing separately might be smart if you suspect your spouse may be committing tax fraud, is behind on tax payments, or owes child support, because you’ll be protected from shady behavior and your refund (if you’re owed one) won’t be held up by the IRS.

Also keep in mind that if you and your spouse work or live in different states, your state may require you to file separately in your state and jointly for your federal returns to ensure you won’t be taxed twice (in your state and your spouse’s state) on the same income. The exception to this rule is if you live in a community property state where all marital assets are considered joint property.