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I am doing some tax brainstorming. I am curious if anyone here has used itemized deductions and married filing seperately to get some tax breaks.
Here is the obvious one I found:
Both my wife and I work. I make significantly more than she does. If we funnel all health expenses thru her, we could deduct health expenses which are more than 10% of her AGI if we itemize and file seperately. Then apply the more common deductions (mortgage interest and property taxes) against the higher income.
ex: spouse 1 makes 80k
spouse 2 makes 50k after 401k and similar, AGI might be 40k
any health expenses larger than 4k could then be deducted. If filing jointly, the AGI would be around 100k and thehealth expenses greater than 10k could be deducted.
I am curious if anyone here has done this or thought about it. While working or while retired. I could see some good planning used when retired to have one spouse have low withdraws from retirement accounts and funnel as much of deductable expenses through their name (health expenses, real estate taxes, mortgage interest).
One disadvantage of doing this is both spouses would not be eligible for Roth IRA contributions.
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