One spouse retired in 2023, other spouse still sole proprietor

Forum|Forum|1 year ago
March 31, 2025
2 replies
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All previous years we have filed jointly using Home-Business Desktop. I retired in 2023 with no income in 2024. Best begin 2024 return filing separately? (Wife with business income and expenses. Me with none.)

TurboTax Home & Biz Windows

Best answer by RobertB4444

Yes. Don't change a thing except removing the one business that is closed. Filing jointly will be best for both of you.

@mhr1

VolvoGirl

Employee

Joint should still be better. Do you get Social Security? You get a higher standard deduction even if 1 spouse has no income. Some reasons for Joint. There are several credits you can't take when filing separately, like the

EITC Earned Income Tax Credit

Child Care Credit

Educational Deductions and Credits

And contributions to IRA and ROTH IRA are limited when you file MFS.

Also if you file Married Filing Separately up to 85`% of your Social Security becomes taxable right away even with zero other income.

AmyC

Employee

For your personal return, you can file MFJ. The IRS has a quick quiz to help determine the Filing status that is best for you.

For the business:

If you live in a community property state, you have been filing sch C for each of you. You retire and she claims it all.
If you don't live in a community property state, you have been filing partnership returns. The partnership needs to be dissolved.

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