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How can I separate charitable donations on a joint return?
- My wife and I have approximately equal income levels, only different by $10K.
- We have > $20K of charitable donations.
- In Turbo Tax charitable donations go to one or the other taxpayer.
- Both the marginal and the average tax rates are quite different for each spouse with either taking the total donations.
- How can I assign some donations to one and some to the other to minimize the total tax payable?
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October 29, 2019
7:30 PM
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Credits and deductions
If you want more ability to assign credits, you need to prepare separately for you and your spouse. That's what I do for the very reasons you raise, namely that joint preparation invokes certain rules of credit. Usually,assigning all donations to one partner makes sense.
October 29, 2019
7:30 PM
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Credits and deductions
My wife and I file our returns together and because she usually has more donations than she can use (Fed tax = 0) It would be useful (NOT optimized) to be able to divide the donations to reduce the other spouses taxes without resorting to using the OVERRIDE feature of the software, which NETFILE does not allow. I have found by using the override on one spouse's return and NETFILE the other works and then switching the override to the other spouse who has just successfully filed with NETFILE.
October 29, 2019
7:30 PM
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Credits and deductions
Put all donations in your name. Either that or prepare returns separately. There is no joint filing in Canada.
October 29, 2019
7:30 PM